Question
Giselle Ltd. is a calendar-year corporation. Its financial statements for the years 2020 and 2019 contained errors as follows: 2020 2019 Ending inventory $2,000 overstated
Giselle Ltd. is a calendar-year corporation. Its financial statements for the years 2020 and 2019 contained errors as follows:
| 2020 | 2019 | |||
| Ending inventory | $2,000 overstated | $3,000 overstated | ||
| Depreciation expense | $6,000 understated | $12,000 overstated |
Assume that no correcting entries were made at December 31, 2019. Ignoring income taxes, by how much will retained earnings at December 31, 2020 be overstated or understated?
|
| $4,000 understated |
|
| $6,000 overstated |
|
| $6,000 understated |
|
| $15,000 understated |
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Construction Contractors AICPA Audit And Accounting Guide
Authors: American Institute Of CPAs
1st Edition
0870519751, 978-0870519758
