The following are transactions which were recorded in the books of CHESTNUT INTERIORS Inc. during the past year. For each transaction,

i) State and explain one principle or element from the conceptual framework that was violated by relating it to details with in the situation. (Hint: Do not be vague). Do not use full disclosure; or free from error; or. use the same principle or element more than once

ii) Give the entry(ies) to correct/adjust the books assuming that it is now the companys year end at December 31, 2019.

a) CHESTNUT bought a piece of equipment on December 29, 2019. The freight charge to deliver the equipment was recorded as follows. Delivery expense 850 Cash 850

b) On the November 1, CHESTNUT paid six months office rent to cover the month of November and the next five months: Rent expense 21,000 Cash 21,000

c) The sole shareholder of CHESTNUT had a new recreational boat delivered to his home. The owner paid for the item with the companys bank account and recorded the transaction as follows. Equipment 60,000 Cash 60,000

d) On December 15, the company received an advance on a customer order for merchandise that will be shipped F.O.B. Destination during January 2020 and recorded the following. Cash 4500 Sales revenue 4,500