Question
The Cherokee Company auditor discovered some errors. No bugs were fixed during 2020. The bugs are described below: (1) Beginning inventory on January 1, 2020
The Cherokee Company auditor discovered some errors. No bugs were fixed during 2020. The bugs are described below:
(1) Beginning inventory on January 1, 2020 was understated by $5,000.
(2) A two-year insurance policy purchased on April 30, 2020 in the amount of $19,200 was debited to Prepaid Insurance. No adjustment was made on December 31, 2020 or December 31, 2021.
Required:
Prepare appropriate journal entries (assume the 2021 books have not been closed). Ignore income taxes.
Step by Step Solution
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Step: 1
To correct the errors discovered by the auditor we need to make the appropriate journal entries for ...
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Intermediate Accounting Reporting and Analysis
Authors: James M. Wahlen, Jefferson P. Jones, Donald Pagach
2nd edition
9781305727557, 1285453824, 9781337116619, 130572755X, 978-1285453828
