BE6-10 Johal Company counted and recorded its ending inventory as at December 31, 2002, incor- rectly, understating its correct value by $25,000. Assuming that this misstatement was not discov- ered and corrected, what is the impact of this error on assets, liabilities, and owner's equity at the end of 2002? At the end of 2003?

BE6-10 Johal Company counted and recorded its ending inventory as at December 31, 2002, incor- rectly, understating its correct value by $25,000. Assuming that this misstatement was not discov- ered and corrected, what is the impact of this error on assets, liabilities, and owner's equity at the end of 2002? At the end of 2003?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concord, Inc. has had some turnover in its parts inventory area. As a result, some inventory counting errors have been made in taking the physical ending inventory in the last two fiscal years. Its financial statements for the years 2026 and 2025 contained errors as follows: Ending inventory Fiscal 2026 $2000 understated $16600 overstated $2000 understated $18600 understated O $2000 overstated оо Fiscal 2025 Concord has a 9/30 fiscal year-end. Assume that no correcting entries were made and that no additional errors occurred in fiscal 2027. Ignoring income taxes, by how much will working capital be overstated or understated at 9/30/26? $16600 overstated
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If the ending inventory is overstated in the current year: Net income will be understated in the current year. Next year's beginning inventory will also be overstated. Next year's net income will be overstated. Next year's beginning inventory will be understated.
During 20x3, Pryor Company changed its inventory method from the LIFO to FIFO. The beginning inventory under FIFO is $20,000 higher than under LIFO. Prepare the journal entry to record this accounting change. Ignore income tax.
(S) porins) An audit of Antwren revealed four errors that were made but never corrected. In 2021, ending inventory was overstated by $201, 000 and depreciation was overstated by $44,000. In 2022, nding inventory was understated by $111, 000 and wages expens as understated by $86, 000. What effect did these errors have 0 htwren's 2022 net income? (RE&CF 6) understated by $226, 000 overstated by $132, 000 pverstated by $157,000 inderstated by $25,000
If Wakowski Company's ending inventory was actually $86,000 but was adjusted at year end to a balance of $68,000 in error, what would be the impact on the presentation of the balance sheet and income statement for the year that the error occurred, if any? If no entry is required, select "None" and leave the amount boxes blank. Balance Sheet: Merchandise Inventory $4 Current Assets Total Assets Retained Earnings Income Statement: Cost of Goods Sold Gross Profit/Gross Margin Net Income
A 105.
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