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Please help me to fill out INCORRECT parts , thanks You have been engaged to review the financial statements of Oriole Inc. In the course
Please help me to fill out INCORRECT parts , thanks
You have been engaged to review the financial statements of Oriole Inc. In the course of your investigation you find a number of irregularities during the current year. 1. a Insurance for a 6-month period purchased on October 1 of this year was charged to prepaid insurance in the amount of $4,400. 2. Year-end estimate of bonuses totaled $67,000 and was not recorded because the payment would not be made until next year. 3. Warranty expense averages 5% on current year sales of $6,000,000. Warranty expense is automatically debited for 5% of each sale. During the current year, the company also paid $270,000 in warranty related claims. The bookkeeper thought that the payments were an expense and debited warranty expense. 4. Office rent is paid quarterly in advance. The first quarter rent for next year ($23,000) was paid in December and rent expense was debited. No. Account Titles and Explanation Debit Credit 1. Insurance Expense 2200 Prepaid Insurance 2200 2. Bonus expense 67,000 Bonus payable 67,000 3. Accrued warranty liability 270,000 Warranty Expense 270,000 4. Prepaid Rent 23,000 Rent Expense 23,000Step by Step Solution
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