Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Dalez Corporation prepared the following two statements of earnings (simplified for illustrative purposes): First Quarter 2017 Second Quarter 2017 18,300 Sales revenue $ 11,300 $

Dalez Corporation prepared the following two statements of earnings (simplified for illustrative purposes): First Quarter 2017 Second Quarter 2017 18,300 Sales revenue $ 11,300 $ Cost of sales Beginning inventory $ 4,100 $ 3,900 Purchases 3,100 13,100 Cost of goods available for sale 7,200 17,000 Ending inventory 3,900 9,100 Cost of sales 3,300 7,900 10,400 Gross profit 8,000 Expenses (operating) 5,100 6,100 Pretax earnings $ 2,900 $ 4,300 During the third quarter, it was discovered that the ending inventory for the first quarter should have been $4,310. Required: 1. What effect did this error have on the combined pretax earnings of the two quarters? 410 Understated 410 Overstated No error 2. Did this error affect the earnings per share amounts for each quarter? Yes No 3. Prepare corrected statements of earnings for each quarter. Cost of sales: First Quarter 2017 Second Quarter 2017 4. Set up a schedule with the following headings to reflect the comparative effects of the correct and incorrect amounts on the statement of earnings: (Select "Understated" or "Overstated" as applicable. Leave no cells blank; select "No error" from the dropdowns if no error is recognized. Input all amounts as positive values.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

More Books

Students also viewed these Accounting questions

Question

Why does sin 2x + cos2x =1 ?

Answered: 1 week ago

Question

What are DNA and RNA and what is the difference between them?

Answered: 1 week ago

Question

Why do living creatures die? Can it be proved that they are reborn?

Answered: 1 week ago

Question

5. Discuss the key roles for training professionals.

Answered: 1 week ago