 |
|
| Browse | Ask | Answer | Search | Join/Login |
|
|
||||
|
Correcting journal entries for accounting problem
What are the errors in the following scenario? I can't find any.
During the 2014 fiscal year, ABC Company exchanged a violin that would normally sell for$1,650 for a computer system that sold for $1,800. The transaction was booked in theaccounting records as follows: DR Computer equipment 1800 CR Revenue 1650 CR Gain on purchase of equipment 150 DR Cost of goods sold 1500 CR Inventory 1500 |
||||
|
||||
|
There is no profit to be booked here. The error is in the way the transactions are viewed
The item was not "sold" and a profit earned since the Retail value was not a value in the books of account The entry should be Cr Inventory 1500 Dr Computer equipment 1500 |
||||
| Question Tools | Search this Question |
Add your answer here.
Check out some similar questions!
UNADJUSTED ACCOUNT BALANCES : accounts receivable DATA FOR ADJUSTMENTS: make allowances for doubtful accounts at 10% of accounts receivable at year-end Please solve this and tell me what is meant by doubtful accounts?
What is the correct journal entry for stagnant checks?
This is the first part of the question from my homework: In the course of routine checking of all journal entries prior to preparing yearend Reports, Sally Yount discovered several strange entries. She recalled that the president’s Son Ken had come in to help out during an especially busy time...
My unadjusted trial balance balanced out, but I cannot get my adjusting entries to balance. Here are the ones that I am having specific trouble with. I know that they need correcting. 10/1 Purchased the required insurance policies for your business. The yeraly cost of the policies is $4800. You...
Funds were entered into the wrong revenue account how do I correct this. The funds were receipted into a foreign revenue account and should have been received into a USD revenue account. How do I reverse and correct this? LiLi
View more questions Search
|
