Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Q4. Provide journal entries correct the errors in Q4a and Q4b. Q4a . On Jan 1, 2017 Davis Co. bought equipment for $750,000. The entire

Q4. Provide journal entries correct the errors in Q4a and Q4b.

Q4a. On Jan 1, 2017 Davis Co. bought equipment for $750,000. The entire amount was recorded as an expense. The equipment had a ten-year life and a $50,000 residual value. Davis used the straight-line method of depreciation. The error was discovered on Dec 10, 2019. Davis is subject to a 35% tax on income. Provide the journal entries required to correct the error when it was discovered on Dec 10, 2019. [1 marks]

You must show plausible calculations to get credit

Dr.

Cr.

Turn to the next page and answer Q4b.

Q4. Continued. Provide journal entries needed to correct the error made by Scorpion Inc. in Q4b.

Q4b. On June 1, 2019 Scorpion Inc, made a credit sale of $716 to Hannah Co. The terms were 2/10 n 30. Hannah paid for the goods on June 20, with a check made out for the correct amount. However, Scorpions bookkeeper recorded the check at $761. The error was discovered when the Bank Cash Reconciliation was made on June 30. Provide the journal entry needed to correct Scorpions error. [1 marks]

Dr.

Dr.

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_2

Step: 3

blur-text-image_3

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

Human And Social Audit

Authors: N P Agarwal

1st Edition

8176113980, 978-8176113984

More Books

Students also viewed these Accounting questions

Question

(a) What is a ledger? (b) Why is a chart of accounts important? LO9

Answered: 1 week ago