Effects of Errors on Firancial Statements The accountant for Healthy Life Company, a medical services consulting...

 

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Effects of Errors on Firancial Statements The accountant for Healthy Life Company, a medical services consulting firm, mistakenly omitted adjusting entries for (a) unearned revenue eamed during the vear ($19,220) and (b) accrued wages ($7,510). Indicate the effect of each error, considered individually, on the income statement for the current year ended July-31. Also indicate the effect of each error on the July 31 balance sheet. Enter all amounts as positive numbers. Enter "0" in those spaces where there is no overstatement or na understatement. Error (a) The adjusting entry for unearned revenue earned during the year ($19,220) was omitted. Overstated Understated 1. Revenue for the year would be 2. Expenses for the year would be 3. Net income for the year would be 4. Assets at July 31 would be 5. Liabilities at July 31 would be 6. Owner's equity at July 31 would be Error (b) The adjusting entry for accrued wages ($7,510) was omitted. Overstated Understated 1. Revenue for the year would be vear would be Effects of Errors on Firancial Statements The accountant for Healthy Life Company, a medical services consulting firm, mistakenly omitted adjusting entries for (a) unearned revenue eamed during the vear ($19,220) and (b) accrued wages ($7,510). Indicate the effect of each error, considered individually, on the income statement for the current year ended July-31. Also indicate the effect of each error on the July 31 balance sheet. Enter all amounts as positive numbers. Enter "0" in those spaces where there is no overstatement or na understatement. Error (a) The adjusting entry for unearned revenue earned during the year ($19,220) was omitted. Overstated Understated 1. Revenue for the year would be 2. Expenses for the year would be 3. Net income for the year would be 4. Assets at July 31 would be 5. Liabilities at July 31 would be 6. Owner's equity at July 31 would be Error (b) The adjusting entry for accrued wages ($7,510) was omitted. Overstated Understated 1. Revenue for the year would be vear would be

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Soufion fnor a The adsusting enty for uneamed revenue eaned du... View the full answer