Give the solutions of 1-7 questions and explanations how you come up with that answers.

Chapter 6 - Correction of Errors PROBLEM 6-4 Noncounterbalancing Errors You discovered the following errors in connection with your examination of the financial statements of Joy Corporation: 1) The Company paid one-year insurance premium of P24,000 effective April 1, 2020. The entire amount was debited to asset account and no adjustment was made at the end of 2020. 2) The company leased a portion of its building for P48,000. The term of the albelease is one year ending April 30, 2021. Collection of rent was credited to unearned rent revenue account. At the end of 2020, no entry was made to un take up the earned portion of the amount collected. 3) Depreciation expense in 2020 was understated by P12,000. 4) Improvements on building amounting to P200,000 had been charged to expense on January 1, 2020. Improvements have a life of 5 years. 5) On January 1, 2020, an equipment costing P40,000 was sold for P20,000. At the date of sale, the equipment had an accumulated depreciation of P15,000 The cash received was recorded as other income in 2020. 6) Repairs expense on the building amounting to P20,000 had been charged to the building account on January 1, 2020. Depreciation expense has been recorded in 2020 and 2021 based on the 5 year remaining useful life of the building The following data were extracted from the financial statements of Joy Corporation: 2020 2021 Net income 100,000 150,000 Working capital 300,000 400,000 RE, end of the year 100,000 250,000 Questions: Based on the above data, determine the following: 1. Net income in 2020 a. P221,000 c. P82,000 b. P70,000 d. P114,000 2. Working capital, end of 2020 a. P314,000 c. P332,000 b. P360,000 d. P282,000 3. Retained earnings, end of 2020 a. P221,000 b. P70,000 c. P82,000 d. P114,000 4. Net income in 2021 a. P124,000 b. P160,000 c. P130,000 d. P140,000 a. Chapter 6 - Correction of Errors brown 5. Working capital, end of 2021 P400,000 c. P394,000 b. P424,000 d. P416,000 6. Retained earnings, end of 2021 P250,000 c. P345,000 b. P244,000 d. P266,000 7. Prepare adjusting entries assuming errors were discovered in (a) 2020, (b) 2021, and (c) 2022. a. Chapter 6 - Correction of Errors PROBLEM 6-4 Noncounterbalancing Errors You discovered the following errors in connection with your examination of the financial statements of Joy Corporation: 1) The Company paid one-year insurance premium of P24,000 effective April 1, 2020. The entire amount was debited to asset account and no adjustment was made at the end of 2020. 2) The company leased a portion of its building for P48,000. The term of the albelease is one year ending April 30, 2021. Collection of rent was credited to unearned rent revenue account. At the end of 2020, no entry was made to un take up the earned portion of the amount collected. 3) Depreciation expense in 2020 was understated by P12,000. 4) Improvements on building amounting to P200,000 had been charged to expense on January 1, 2020. Improvements have a life of 5 years. 5) On January 1, 2020, an equipment costing P40,000 was sold for P20,000. At the date of sale, the equipment had an accumulated depreciation of P15,000 The cash received was recorded as other income in 2020. 6) Repairs expense on the building amounting to P20,000 had been charged to the building account on January 1, 2020. Depreciation expense has been recorded in 2020 and 2021 based on the 5 year remaining useful life of the building The following data were extracted from the financial statements of Joy Corporation: 2020 2021 Net income 100,000 150,000 Working capital 300,000 400,000 RE, end of the year 100,000 250,000 Questions: Based on the above data, determine the following: 1. Net income in 2020 a. P221,000 c. P82,000 b. P70,000 d. P114,000 2. Working capital, end of 2020 a. P314,000 c. P332,000 b. P360,000 d. P282,000 3. Retained earnings, end of 2020 a. P221,000 b. P70,000 c. P82,000 d. P114,000 4. Net income in 2021 a. P124,000 b. P160,000 c. P130,000 d. P140,000 a. Chapter 6 - Correction of Errors brown 5. Working capital, end of 2021 P400,000 c. P394,000 b. P424,000 d. P416,000 6. Retained earnings, end of 2021 P250,000 c. P345,000 b. P244,000 d. P266,000 7. Prepare adjusting entries assuming errors were discovered in (a) 2020, (b) 2021, and (c) 2022. a