What is the net effect of the errors in Bonghill’s December 31, 2020 accumulated profits balance? A.Understated by P20,300 B.verstated by P11,800 C.Overstated by P20,300 D.Overstated by P15,400
Bonghill Company’s December 31 year-end financial statements had the following error:
December 31, 2019 December 31, 2020
Ending Inventory P13,500 understated P19,800 overstated
Unearned rental 5,000 understated -
Prepaid insurance - 8,000 understated
There were no other errors during the years 2019 or 2020 and no corrections have been made for any of the errors. (Ignore income tax considerations)
What is the net effect of the errors in Bonghill’s December 31, 2020
A.Understated by P20,300
B.verstated by P11,800
C.Overstated by P20,300
D.Overstated by P15,400
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