P 67,000 overstated D. P 82,000 overstat
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
What is the effect of the foregoing errors on
A. P 22,000 overstated
B. P 38,000 understated
C. P 67,000 overstated
D. P 82,000 overstated

Transcribed Image Text:Robi Corporation reported profit for the years 2012 and 2011 at P700,000 and P550,000,
respectively. Your audit of the company's accounts disclosed the need for adjustments as follows:
2011
2012
Overstatement of ending inventories
due to error in pricing
Omission of depreciation on newly-
acquired equipment
Understatement of Commission receivable
P 29,000
P 33,000
15,000
22,000
15,000
18,000
A purchase of merchandise was not recorded
until the following year, and also was not
included in the ending inventory.
60,000
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