Effect of errors on financial statements. Using the notation O/S (overstated), U/S (understated), and NO (no effect), indicate the effects (direction and amount) on assets, liabilities, and shareholders' equity as of December 31, Year 5, of the following independent errors or omissions. Ignore income tax implications.

a. On December 1, Year 5, a firm paid \(\$ 12,000\) for rental of a building for December, Year 5 and January, Year 6. The firm debited Rent Expense and credited Cash on December 1 and made no further entries with respect to this rental during December or January.

b. On December 15 , a firm received \(\$ 1,200\) from a customer as a deposit on merchandise the firm expects to deliver to the customer in January, Year 6. The firm debited Cash and credited Sales Revenue on December 15 and made no further entries with respect to this deposit during December or January.

c. On December 1, a firm acquired a used forklift truck costing \(\$ 4,800\). The truck was expected to have a two-year life and zero salvage value. The firm recorded the transaction by debiting Repair Expense and crediting Cash for \(\$ 4,800\) and made no further entries during December with respect to the acquisition.

d. On December 15 , a firm purchased office supplies costing \(\$ 8,600\). It recorded the purchase by debiting Office Supplies Expense and crediting Cash. The Office Supplies Inventory account on December 1 had a balance of \(\$ 2,700\). The firm took a physical inventory of office supplies on December 31 and found that office supplies costing \(\$ 2,450\) were on hand. The firm made no entries in its accounts with respect to office supplies on December 31.

e. A firm incurs Interest Expense of \(\$ 1,500\) for the month of December on a 45-day loan obtained on December 1. The firm properly recorded the loan on its books on December 1 but made no entry to record interest on December 31. The loan is payable with interest on January 15, Year 6.

f. A firm purchased merchandise on account costing \(\$ 11,600\) on December 23, Year 5, debiting Merchandise Inventory and crediting Accounts Payable. The firm paid for this purchase on December 28, Year 5, debiting Cost of Goods Sold and crediting Cash. The merchandise had not been sold as of December 31, Year 6.