whats the answer in the 2nd number? a. Po40,000You are auditing the financial statement of Pasig Company for the first fimeYou have discovered that the merchandise inventory at the endCase 5eachasn respectively. In addition, in inspecting the record of the company, youdiscovered that some items had been improperly recorded and that certainyear-end adjustments had been overlooked in 2020 and 2021.These omission and other errors for each year were summarized asfollows:em 12/31/2020P436,800129,600192,00012/31/2021Accrued SalariesAccrued Interests IncomeP390,000106,500153,900Prepaid InsuranceAdvances from Customers(Collections from customers had beenrecorded as sales but should havebeen recognized as advances fromcustomers because goods were notshipped until the following year)Machinery (Capital expenditures hadbeen records as repairs but shouldhave been charged to Machinery; thedepreciation rate is 10% per year, butdepreciation in the year of expenditureis to be recognized at 5%.)280,500235,200261,000282,000 Chapter 1: Audit Planning and Misstate mentDetermine the following as a result of your audit:1. What is the total effect of the errors on the 2020 net income?a. increased by P15,000b. decreased by P22,000c. decreased by P32,500d. increased by P11,5002. What is the total effect of the errors on the 2021 net income?a. increased by P210,050b. decreased by P205,550c. decreased by P132,500d. increased by P242,5503. What is the total effect of the errors on the balance of the company'sretained earnings at December 31, 2021?a. increased by P177,550b. decreased by P122,050c. decreased by P132,550d. increased by P171,5504. What is the total effect of the errors on the company's working capitalat December 31, 2021?a. decreased by P150,550b. decreased by P202,0002c. decreased by P302,500d. decreased by P310,1005. The necessary adjusting journal entry for the error in recording capitalexpenditures on Machinery as of December 31, 2021 would include a:a. a debit to machinery of P543,000b. a credit to retained earnings of P323,250c. a debit to depreciation expense of P13,050d. a credit to accumulated depreciation of P41,250Case 6

Errors include omisssions. impact of previous year errors will also consider for correction of…

You are auditing the financial statement of Pasig You have discovered that the merchandise inventory at the end of ee year was understated by P50,000 and P100,000 in 2020 and 2021 respectively. In addition, in inspecting the record of the company, vou discovered that some items had been improperly recorded and that certain year-end adjustments had been overlooked in 2020 and 2021. Case 5 These omission and other errors for each year were summarized as follows: 12/31/2021 12/31/2020 Accrued Salaries Accrued Interests Income P390,000 106,500 153,900 e P436,800 ur129,600 192,000 Prepaid Insurance Advances from Customers (Collections from customers had been recorded as sales but should have been recognized as advances from customers because goods were not shipped until the following year) Machinery (Capital expenditures had been records as repairs but should have been charged to Machinery; the depreciation rate is 10% per year, but depreciation in the year of expenditure is to be recognized at 5%.) 280,500 235,200 261,000 282,000

You are auditing the financial statement of Pasig You have discovered that the merchandise inventory at the end of ee year was understated by P50,000 and P100,000 in 2020 and 2021 respectively. In addition, in inspecting the record of the company, vou discovered that some items had been improperly recorded and that certain year-end adjustments had been overlooked in 2020 and 2021. Case 5 These omission and other errors for each year were summarized as follows: 12/31/2021 12/31/2020 Accrued Salaries Accrued Interests Income P390,000 106,500 153,900 e P436,800 ur129,600 192,000 Prepaid Insurance Advances from Customers (Collections from customers had been recorded as sales but should have been recognized as advances from customers because goods were not shipped until the following year) Machinery (Capital expenditures had been records as repairs but should have been charged to Machinery; the depreciation rate is 10% per year, but depreciation in the year of expenditure is to be recognized at 5%.) 280,500 235,200 261,000 282,000

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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Zina Manufacturing Company started and completed Job 501 in December with the following Job Cost Sheet and transferred it to the warehouse. Direct Materials Date Dec 17 Dec 30 Total Direct Labor Amount Date Amount $2,000 Dec 20 $4,000 8,000 Dec 30 3,800 Total Job Cost Sheet - Job No. 501 Total Cost The journal entry to record the transaction is A) WIP Inventory FG Inventory B) Cost of Goods Sold WIP Inventory C) FG Inventory WIP Inventory D) FG Inventory WIP Inventory Debit Credit 35,800 17,800 17,800 Manufacturing Overhead Date Amount Dec 24 $10,000 Dec 30 8,000 Total 35,800 35,800 17,800 17,800 35,800
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