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What is the effect of omitting the item

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Reference no: EM132774188

On December 31, 2018, XYZ Co. has the following information in the statement of ?nancial position:

Bond payable due on 2021 $150,000

Equity attributable to owners 550,000

Share Discount- ordinary 15,000

Investment in Held-for-collection securities 6,500

Account receivables 70,000

Treasury shares 50,000

Allowance for doubtful account 10,000

Share Premium- ordinary 7,000

Accumulated other comprehensive income 30,000

Problem 1: If XYZ Co. omitted recording the share discount in the statement of ?nancial position, what is the effect of omitting this item?

A. Equity attributable to owners wiil be understated by $15,000

B. Share capital will be understated by $15,000

C. Equity attributable to owners will be overstated by 515,000

D. No effect

Reference no: EM132774188

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