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    cool12's Avatar
    cool12 Posts: 1, Reputation: 1
    New Member
    		  
    #1

    Oct 4, 2008, 05:27 PM
    Prior year adjustment and notes on financial statement
    What are the types of prior year adjustments?
    How to report on current year financial statements?
    Are there any financial guide lines or GAAP rules?
    cool12
    ashalanew's Avatar
    ashalanew Posts: 1, Reputation: 1
    New Member
    		  
    #2

    Jul 26, 2010, 06:49 PM
    While reviewing the accounts receivable aging you noticed several large 150 day
    outstanding balances for accounts that were otherwise current. Upon questioning the
    accounts receivable supervisor you were told that there had been a problem with the
    orders. The systems shipped were defective and had been returned. The production
    manager said “New systems would be shipped out so don't worry about adjusting the
    books. Unfortunately, the customers canceled the orders and bought similar systems from
    a competitor. You also learned that the defective systems could not be economically
    repaired but were still counted and included in the ending inventory. The original saleswere recorded at $38,000. The inventory was valued at $23,000.The company uses the
    direct method to record sales returns.
    morgaine300's Avatar
    morgaine300 Posts: 6,561, Reputation: 276
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    #3

    Jul 30, 2010, 01:09 AM

    Please always start a new thread for your question instead of tagging onto someone else's. (Imagine if 100's of people just tagged onto other threads all the time.) And also please see the guidelines for submitting homework:
    https://www.askmehelpdesk.com/financ...-b-u-font.html
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