Financial accounting 16th Edition by Jan Williams,Susan Haka,Mark Bettner ,Joseph Carcello

تمرين 41

Correcting Erros - Recording of Merchandising Transactions
Queen Enterprises is a furniture wholesaler.ueen hired a new accounting clerk on January 1 of the current year.he new clerk does not understand accrual accounting and recorded the transac­tions below based on when cash receipts and disbursements changed hands rather than when the transaction occurred.ueen uses a perpetual inventory system, and its accounting policy calls for inventory purchases to be recorded net of any discounts offered.
Jan. Paid Hardwoods Forever Inc.4,900 for furniture that it received on December 20.
(This purchase was recorded as a debit to Inventory and a credit to Accounts Payable on December 20 of last year, but the accounting clerk ignores that fact.)
Dec.3 Received furniture from Koos Hoffwan Co.or $10,000; terms 2/10, n/30.
Dec.6 Sold furniture to Beige Chipmunk Inc.or $15,000; terms 1/10, n/30.he cost of the furniture to Queen was $12,250.
Instructions
a.s a result of the accounting clerk's errors, compute the amount by which the following accounts are overstated or understated:
1.ccounts Receivable
2.nventory
3.ccounts Payable
4.ales
5.ost of Goods Sold
b.ompute the amount by which net income is overstated or understated.
c.repare a single journal entry to correct the errors that the accounting clerk has made.Assume that Queen has yet to close its books for the current year.)
d.ssume that Queen has already closed its books for the current year.ake a single journal entry to correct the errors that the accounting clerk has made.
e.ssume that the ending inventory balance is correctly stated based on adjustments resulting from a physical inventory count.Cost of Goods Sold was debited or credited based on the inventory adjustment.) Assume that Queen has already closed its books for the current year, and make a single journal entry to correct the errors that the accounting clerk has made.