Section Three:

The Mace Company fails to record these Journal Entries

Cash dividend declared	$50
Expiration of Prepaid Insurance	$30
Purchase of Supplies on Credit	$17

Required:

Determine the net effect of these errors on the following items. Indicate the dollar amount of the error and the direction of the error. (Example: $17 overstated, or $12 understated, or NO ERROR)

1. Net Income $_______________
2. Total Liabilities $_______________
3. Total Assets $_______________
4. Retained Earnings $_______________