MATERIALITY AND TOLERABLE ERROR: An auditor finds the following errors in the books of Jonas Industries:

a $10 000 provisions for doubtful debts not recorded b $8000 payable to a supplier accrued twice c $23 000 of recorded sales are in next year’s invoices d $5000 should be written off as a bad debt (provision method).

Required: Jonas does not wish to adjust for these errors. Prepare a schedule showing the impact of them on the financial statements and on key ratios of concern. The following accounts have unadjusted balances:

Accounts receivable (net) $1 043 000 Accounts payable $85 000 Sales $959 000 Expenses $940 000 Net income $19 000 Working capital ratio (2340/1170)