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Charlie Cheeryble of Cheeryble Brothers and Company called Tim Linkinwater, the company controller, into his office one day. This fellow, Nickleby, weve hired recently as

Charlie Cheeryble of Cheeryble Brothers and Company called Tim Linkinwater, the company controller, into his office one day. This fellow, Nickleby, weve hired recently as an accountant-does he know his stuff? Ive been looking through the journal and have come across some entries hes made that dont look quite right to me. Here, take a look. The following are the entries Cheeryble has circled with his pen. All figures are in Naira. (a) Dr. Cash 5,000 Cr. Sales revenue 5,000 5,000 cash received from Customer B in settlement of her account. (b) Dr.Cost of sales 14,000 Cr. Account payable, X 14,000 Purchase of merchandise on account at a cost of 14,000 (c) Dr. Bank loan 112,000 Cr. Cash 112,000 Payment of 100,000 principal, together with total annual interest of 12,000, on maturity of a one-year loan (d) Dr. Bad debt expense 3,000 Cr. Cash 3,000 Write-off of 3,000 balance of unpaid account of bankrupt customer H. (e) Dr. Account payable, X 2,000 Cr. Gain on return of goods 2,000 Return of defective goods costing 2,000 to supplier, who gives full credit for them. Cheeryble has not yet paid for them. (f) Dr. Wage expense 2,500 Cr. Wages payable 2,500 2,500 promised by Cheeryble to family of sick worker. Required Help Tim Linkinwater. What is the entry that he must make in each case in order to correct any error of Nicklebys.

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