User Account

All Pages

Compute the total effect of the errors on net income

Assignment Help Accounting Basics
Reference no: EM131731082

Question - Crane Tool Company's 31 year-end financial statements contained the following errors.

 

December 31, 2017

December 31, 2018

Ending inventory

$10,500 understated

$8,200 overstated

Depreciation expense

$2,400 understated

 

An insurance premium of $69,000 was prepaid in 2017 covering the years 2017, 2018, and 2019. The entire amount was charged to expense in 2017. In addition, on December 31, 2018, fully depreciated machinery was sold for $16,000 cash, but the entry was not recorded until 2019. There were no other errors during 2017 or 2018, and no corrections have been made for any of the errors. (Ignore income tax considerations.)

(a) Compute the total effect of the errors on 2018 net income?

(b) Compute the total effect of the errors on the amount of Crane's working capital at December 31, 2018.

(c) Compute the total effect of the errors on the balances of Crane's retained earnings at December 31, 2018.

Reference no: EM131731082

Questions Cloud

Percentage change in the price of bond bill : If rates were to suddenly fall by 2 percent instead, what would the percentage change in the price of Bond Bill be then? Of Bond Ted?
Write and explain all possible accounting journal entries : In October $50,000 of refunds were issued (customers who complained) Write and explain all possible accounting journal entries
Define the treatment of rheumatoid arthritis : Why are monoclonal antibodies against cytokines used in the treatment of rheumatoid arthritis that is unresponsive to conventional therapy
Compute interest rate risk of lower-coupon bonds : Interest Rate Risk. Bond J has a coupon rate of 4 percent. Bond S has a coupon rate of 14 percent. Both bonds have 13 years to maturity.
Compute the total effect of the errors on net income : Crane Tool Company's 31 year-end financial statements contained the following errors. Compute the total effect of the errors on 2018 net income
Discuss how success of therapy will be evaluated : Discuss How success of therapy will be evaluated, Patient education provided
Preliminary assessment of control risk indicates : If the preliminary assessment of control risk indicates that the risk may be below the maximum level and assessment would reduce overall audit time and effort.
What is the current yield on pk bonds : Bond Yields. PK Software has 6.3 percent coupon bonds on the market with 22 years to maturity. The bonds make semiannual payments and currently sell for 97.
What coupon rate should the company set on new bonds : Bond Yields. BDJ Co. wants to issue new 25-year bonds for some muchneeded expansion projects. The company currently has 5.6 percent coupon bonds on the market.

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Theory of interest - term structure of interest rates

Term Structure of Interest Rates

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd