Effects of errors on financial statementsThe accountant for Healthy Life Consulting, a medical services consulting firm, mistakenly omitted adjusting entries for (a) unearnedrevenue earned during the year ($26,250) and (b) accrued wages ($8,470).Indicate the effect of each error, considered individually, on the income statement for the current year ended July 31. Also indicate theeffect of each error on the July 31 balance sheet.Enter all amounts as positive numbers. Enter "0" in those spaces where there is no overstatement or no understatement.Error (a) The adjusting entry for unearned revenue earned during the year ($26,250) was omitted.1. Revenue for the year would be2. Expenses for the year would be3. Net income for the year would be4. Assets at July 31 would be5. Liabilities at July 31 would be6. Owner's equity at July 31 would beOverstatedALASASAtA0000UnderstatedLA00000LALA Error (b) The adjusting entry for accrued wages ($8,470) was omitted.Overstated1. Revenue for the year would be2. Expenses for the year would be3. Net income for the year would be4. Assets at July 31 would be5. Liabilities at July 31 would be6. Owner's equity at July 31 would be$LALALALALADOLUnderstatedLA1000tA

To begin with, keeping accurate records of your transactions will aid in the organization of the…

The accountant for Healthy Life Consulting, a medical services consulting firm, mistakenly omitted adjusting entries for (a) unearned revenue earned during the year ($26,250) and (b) accrued wages ($8,470). Indicate the effect of each error, considered individually, on the income statement for the current year ended July 31. Also indicate the effect of each error on the July 31 balance sheet. Enter all amounts as positive numbers. Enter "0" in those spaces where there is no overstatement or no understatement.

The accountant for Healthy Life Consulting, a medical services consulting firm, mistakenly omitted adjusting entries for (a) unearned revenue earned during the year ($26,250) and (b) accrued wages ($8,470). Indicate the effect of each error, considered individually, on the income statement for the current year ended July 31. Also indicate the effect of each error on the July 31 balance sheet. Enter all amounts as positive numbers. Enter "0" in those spaces where there is no overstatement or no understatement.

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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