Problem 7 CPA Co.'s December 31 year end financial statement contained the following errors: December 31,2020 P90,000 overstated December 31,2019 Ending Inventory Depreciation expense P100,000 understated 20,000 understated An insurance premium of P75,000 was prepaid in 2019 covering the years 2019, 2020 and 2021. The same was charged to expense in full in 2019. In addition, on December 31, 2020, a fully depreciated machinery was sold for P160,000 cash, but the sale was not recorded until 2021. There were no other errors during 2019, 2020 and 2021 and no corrections have been made for any of the errors. Based on the above and the result of your audit, determine the following: (Ignore income tax effect and write under or over) _8. Net effect of errors on the 2019 profit 9. Net effect of errors on the 2020 profit 10. Net effect of errors on the company's December 31, 2020 retained

Problem 7 CPA Co.'s December 31 year end financial statement contained the following errors: December 31,2020 P90,000 overstated December 31,2019 Ending Inventory Depreciation expense P100,000 understated 20,000 understated An insurance premium of P75,000 was prepaid in 2019 covering the years 2019, 2020 and 2021. The same was charged to expense in full in 2019. In addition, on December 31, 2020, a fully depreciated machinery was sold for P160,000 cash, but the sale was not recorded until 2021. There were no other errors during 2019, 2020 and 2021 and no corrections have been made for any of the errors. Based on the above and the result of your audit, determine the following: (Ignore income tax effect and write under or over) _8. Net effect of errors on the 2019 profit 9. Net effect of errors on the 2020 profit 10. Net effect of errors on the company's December 31, 2020 retained

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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How much would the December 31,2020 retained earnings be misstated if the books are not yet closed?
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37 ABC Company reported net income and retained earnings for a two – year period as follows: Net Income Retained Earnings, Ending 2020 6,000,000 6,000,000 2021 8,000,000 14,000,000 In checking the statement for the year ended December 31, 2020, the following errors are discovered: The company paid one – year insurance premium of P 240,000 effective April 1, 2020. The entire amount was debited to asset account and no adjustment was made at the end of 2020. The company leased a portion of its building for P 480,000. The term of the lease is one year ending April 30, 2021. Collection of rent was credited to unearned rent revenue account. At the end of 2020, no entry was made to take up the earned portion of the amount collected. Depreciation expense in 2020 was understated by P 12,000. Depreciation expense in 2021 was overstated by P 14,000. Bad debts expense of P 11,000 was not recorded in 2020. How much is…
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2.2. During 2021, Gamma Ltd discovered that some of their products sold during 2020 were incorrectly included in inventory as 31 December 2020 at R6 500. Assume a tax rate of 30%. Assume that the prior period error effect is considered to be material. Gamma Ltd.'s accounting records are as follows: 2021 Sales Cost of sales Profit before tax 208 000 (173 500) 35 000 (10 500) 24 500 2020 147 000 (107 000) 40 000 (12 000) 28 000 Taxation Profit The profit for 2021 includes R13 500 for the error made in opening inventory Additional information: 2020 opening retained earnings was R40 000 and closing retained earnings was R68 000. Gamma's income tax rate was 30% in 2021 as well as in 2020. It had no other income or expenses. Gamma Ltd has R10 000 of share capital throughout 2020 and 2021, as well as retained earnings. REQUIRED: Disclose the effect of the error in the financial statements for the year ended 31 December 2021
whats the answer in question 4?
y courses / BUSS 104-1-20202 / MAKEUP TEST SCHEDULED FOR Thursda E (06-05-2021 from 11:00 to 12: Noon) The XYZ Company had the following income statement on 31.12.2020 Deprecation 5000 Net income 110000 OMR The following accounts decreased during 2020: Accounts receivable 24000 inventory 18000 OMR, Rent payable 15000, Machinery 15000 OMR The following accounts increased during 2020:Notes receivable 14000 Accounts Payable 8000 long term Bonds payable 30000 OMR Calculate cash flows from operating activities Select one: Oa. 149000 OMR O b. NONE OF THESE O c. 136000 OMR O d. 145000 OMR
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A 105.
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