The following errors were reported by Claude Sample Sports Clinic during the month:An invoice for consultancy service provided to Running Track Club for $25,000 was left in a desk drawer unnoticed and had been omitted completely from the books. The records showed that a cash receipt for $15,000 was issued relating to this transaction while the balance was on account. The company records its consultancy fees in service revenue account.Purchase of medical supplies on February 3 was for $18,000and not $1,800 as previously incorrectly reported. On Feb 1 the $55,000 invested by Sample ought to have been allocated $45,000 bank account and $10,000 office equipment based on confirmation from the owner that the previous info provided was incorrectly stated.Drawings of $1,000 were not recorded.An electricity bill for $5,000 paid by cash was placed in a desk drawer and not presented with the first set of transactions. The company records its electricity charges in the utility expense account. Required: i. Record the journal entries necessary to correct each of the errors mentioned above. Narrations are not required

JOURNAL ENTRIES The First stage of Recording of All financial and Non financial Transactions into a…

Answered: The following errors were reported by…

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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The following errors were reported by Claude Sample Sports Clinic during the month:

An invoice for consultancy service provided to Running Track Club for $25,000 was left in a desk drawer unnoticed and had been omitted completely from the books. The records showed that a cash receipt for $15,000 was issued relating to this transaction while the balance was on account. The company records its consultancy fees in service revenue account.
Purchase of medical supplies on February 3 was for $18,000and not $1,800 as previously incorrectly reported.
On Feb 1 the $55,000 invested by Sample ought to have been allocated $45,000 bank account and $10,000 office equipment based on confirmation from the owner that the previous info provided was incorrectly stated.
Drawings of $1,000 were not recorded.
An electricity bill for $5,000 paid by cash was placed in a desk drawer and not presented with the first set of transactions. The company records its electricity charges in the utility expense account.

Required:

i. Record the journal entries necessary to correct each of the errors mentioned above. Narrations are not required

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Prepare the following for the month of February 2015:

Income statement
Statement of owner’s equity
Balance Sheet

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