While examining the accounts of Combate Company on December 31, 2020, the following errors were uncovererd:Dividends of P100,000 had been declared on December 31, 2020 but was not recorded in the books.Improvements in Buildings and equipment for P480,000 had been debited to expense at the end of April in 2019. Improvements are estimated to have estimated life of 8 years.The company failed to record sales commissions payable amounting to P10,500 and P19,000 at the end of 2019 and 2020, respectivelySupplies on hand amounting to P6,000 and P15,000 were not recognized at the end of 2019 and 2020, respectively. What is the net effect of the above errors on 2019 & 2020 net income?

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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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While examining the accounts of Combate Company on December 31, 2020, the following errors were uncovererd:

Dividends of P100,000 had been declared on December 31, 2020 but was not recorded in the books.
Improvements in Buildings and equipment for P480,000 had been debited to expense at the end of April in 2019. Improvements are estimated to have estimated life of 8 years.
The company failed to record sales commissions payable amounting to P10,500 and P19,000 at the end of 2019 and 2020, respectively
Supplies on hand amounting to P6,000 and P15,000 were not recognized at the end of 2019 and 2020, respectively.

What is the net effect of the above errors on 2019 & 2020 net income?

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