question from inventory, Basic Statistics

Assignment Help:
CASE STUDY 1 3 MARKS

An audit of the accounting records of Loch Ness Ltd. for the year ending 30 June 2012 discovered that the ending inventory balance was over-valued by $35,000. Upon further investigation, it was discovered that the ending inventory for the previous year was correctly counted and valued, but that the inventory balance as at 30 June 2010 was under-valued by $90,000.
The auditor, concerned at these errors, decides to carry out a thorough investigation (audit) as to the inventory values shown in the company’s financial statements during its six-year history. The following additional errors were detected:

(i) as at 30 June 2009, inventory was over-valued by $15,000

(ii) as at 30 June 2008, inventory was under-valued by $55,000

Required :

1. Determine the effects that these errors have had on the company’s profit figures in each year, beginning in the year ended 30 June 2008.

2. Determine the effect of the inventory errors on the company’s balance sheets over the total time period. Include in your answer the cumulative impact on the company’s retained profits/earnings.

Related Discussions:- question from inventory

Bonds payable, Bonds payable The face worth of bonds issued and honorary. ...

Bonds payable The face worth of bonds issued and honorary. In the case of zero-coupon bonds, however, and the only and the accreted value of the tie is reported as bonds owed on t

Limitation of the accounting, Limitation of the Accounting. It informati...

Limitation of the Accounting. It information only accounting purchase, it is restricted to the accounting purchase only, and for example other elements which are not having any

Accounting cycle, The Steven Wholesale Co. uses the periodic inventory syst...

The Steven Wholesale Co. uses the periodic inventory system. The following transactions occurred during the month of May, the last month of the fiscal year that runs from June 1 t

Variance, V ariance A measure of dispersion the variance represents...

V ariance A measure of dispersion the variance represents the average distance from any given observation in a series to the mean of that series in the units squared.

Card custodian, Card custodian An person who is assigned responsibility of...

Card custodian An person who is assigned responsibility of purchase card security & issuance of cards to authorized users,

Bi variate frequency distribution, solved example with data of bi variate f...

solved example with data of bi variate frequency distribution

Hypothesis the basic short-run and long-run, In reguards to the airlines in...

In reguards to the airlines indusry, provide a minimum of 300 words for each statement. plus atleast 3 academic resources. 1. hypothesis the basic short-run and long-run behavio

Probability, Mike sells on the average 15 newspapers per week (Monday – Fri...

Mike sells on the average 15 newspapers per week (Monday – Friday). Find the probability that 2.1 In a given week he will sell all the newspapers

Index numbers, discuss the considerations to be borne in mind when construc...

discuss the considerations to be borne in mind when constructing index numbers

Write Your Message!

Captcha
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!

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