You will be examining the financial statements of Tim’s Coffee Shoppe to analyze operations.

In looking at the financial statements provided in the simulation:

• How should the existing error in the financial statements be corrected? Why?
• Why is it important to make sure that the statements are correct?

 

Transcribed Image Text:

Tim's Coffee Shoppe Income Statement For the Year Ended December 31, 2017 Income earned. ......... $475,680 ........ Expenses: Salaries expense Rent expense Depreciation expensé ......... Supplies expense Lease expense 125,000 14,400 .................. ......... .... ....... .... 12,116 .... 152,000 4,000 67,000 72,500 8.956 ... ........ ................. Tax expense ... Interest expense .... . Insurance expense .................... ........ Total expenses Net income *.**.. 455,972 $19,708 .... ..................... Tim's Coffee Shoppe Income Statement For the Year Ended December 31, 2017 Income earned. ......... $475,680 ........ Expenses: Salaries expense Rent expense Depreciation expensé ......... Supplies expense Lease expense 125,000 14,400 .................. ......... .... ....... .... 12,116 .... 152,000 4,000 67,000 72,500 8.956 ... ........ ................. Tax expense ... Interest expense .... . Insurance expense .................... ........ Total expenses Net income *.**.. 455,972 $19,708 .... .....................

Answer rating: 100% (QA)

1 Errors in the income statement Tax expenses cannot be included in the total expenses because they ... View the full answer