REQUIRED: 

Determine the following:

1. Corrected net loss for 20x2 ____________

2. Corrected net income for 20x3 ____________

3. Corrected net income for 20x4 ____________

4. Retained Earnings balance on December 31, 20x4 ____________

5. Adjusted inventory balance on December 31, 20x4 ____________

6. Total assets as on December 31, 20x4
 

Transcribed Image Text:

You have been engaged to review the records and prepare corrected financial statements for Harlequin Company. The books of accounts agree with the following statement of financial position: HARLEQUIN COMPANY Statement of Financial Position December 31, 20x4 (in thousands) Assets Cash Accounts Receivable Notes receivable Inventory Total Assets Liabilities and Shareholders' Equity Accounts Payable Notes Payable Share Capital Retained Earnings Total Liabilities and Shareholders' Equity Inventory-overstated Inventory-understated Prepaid expense Deferred revenue Accrued expense Accrued revenue 20x1 P36,000 5,400 1,200 A review of the books of the company indicates that the following errors and omissions had not been corrected during the applicable years: 150,000 P258,000 20x2 P30,000 60,000 18,000 162,000 P258,000 P12,000 24,000 60,000 December 31 P42,000 4,200 2,400 450 750 20x3 P48,000 3,000 600 20x3 P39,000 20x4 P54,000 3,600 1,800 300 900 20x2 P45,000 20x4 P33,000 Net income per books No dividends were declared during these years, and no adjustments were made to retained earnings. Ignore possible income tax effects. You have been engaged to review the records and prepare corrected financial statements for Harlequin Company. The books of accounts agree with the following statement of financial position: HARLEQUIN COMPANY Statement of Financial Position December 31, 20x4 (in thousands) Assets Cash Accounts Receivable Notes receivable Inventory Total Assets Liabilities and Shareholders' Equity Accounts Payable Notes Payable Share Capital Retained Earnings Total Liabilities and Shareholders' Equity Inventory-overstated Inventory-understated Prepaid expense Deferred revenue Accrued expense Accrued revenue 20x1 P36,000 5,400 1,200 A review of the books of the company indicates that the following errors and omissions had not been corrected during the applicable years: 150,000 P258,000 20x2 P30,000 60,000 18,000 162,000 P258,000 P12,000 24,000 60,000 December 31 P42,000 4,200 2,400 450 750 20x3 P48,000 3,000 600 20x3 P39,000 20x4 P54,000 3,600 1,800 300 900 20x2 P45,000 20x4 P33,000 Net income per books No dividends were declared during these years, and no adjustments were made to retained earnings. Ignore possible income tax effects.

Answer rating: 100% (QA)

Solution 1 Corrected net incomeloss for the below years Particulars net ... View the full answer