Question
Hudson Inc. reported pretax income of $40,000 during 2018. The pretax income of Hudson Inc. was...
Hudson Inc. reported pretax income of $40,000 during 2018. The
pretax income of Hudson Inc. was determined without knowledge of
the errors indicated (assume periodic inventory method).
Year 2018 Ending inventory $9,000 understated Year 2017 ending
inventory $14,000 understated
What is the correct pretax income for 2018?
a. $49,000 b. $54,000 c. $63,000 d. $35,000 e. $17,000 f.
$45,000
Homework Answers
Answer #1
Not the answer you're looking for?
Similar Questions
(Inventory Errors) The net income per books of Linda Patrick Company was determined without knowledge of...
(Inventory Errors)
The net income per books of Linda Patrick Company was determined
without knowledge of the errors indicated.
Year
Net Income per Books
Error in Ending Inventory
2012
$50,000
Overstated
$ 3,000
2013
52,000
Overstated
9,000
2014
54,000
Understated
11,000
2015
56,000
No error
2016
58,000
Understated
2,000
2017
60,000
Overstated
8,000
Instructions
Prepare a worksheet to show the adjusted net income figure for
each of the 6 years after taking into account the inventory
errors.
During 2018, WMC Corporation discovered that its ending inventories reported on its financial statements were misstated...
During 2018, WMC Corporation discovered that its ending
inventories reported on its financial statements were misstated by
the following amounts:
2016
understated by
$
148,000
2017
overstated by
206,000
WMC uses the periodic inventory system and the FIFO cost
method.
Required:
1-a. Determine the effect of 2016 errors on
retained earnings at January 1, 2018, before any adjustments.
(Ignore income taxes.)
1-b. Determine the effect of 2017 errors on
retained earnings at January 1, 2018, before any adjustments.
(Ignore...
Empire Co. reported cost of goods sold as follows: 2018 2019 Beginning inventory $ ...
Empire Co. reported cost of goods sold as follows:
2018
2019
Beginning inventory
$ 54,000
$ 64,000
Cost of goods purchased
847,000
891,000
Cost of goods available for sale
901,000
955,000
Ending inventory
64,000
55,000
Cost of goods sold
$837,000
$900,000
Jim Holt, the bookkeeper, made two errors:
(1)
2018 ending inventory was overstated by $3,000.
(2)
2019 ending inventory was understated by $19,000.
Instructions
Assuming the errors had not been corrected, indicate the dollar
effect...
Sherrod, Inc., reported pretax accounting income of $74 million for 2018. The following information relates to...
Sherrod, Inc., reported pretax accounting income of $74 million
for 2018. The following information relates to differences between
pretax accounting income and taxable income: Income from
installment sales of properties included in pretax accounting
income in 2018 exceeded that reported for tax purposes by $7
million. The installment receivable account at year-end had a
balance of $8 million (representing portions of 2017 and 2018
installment sales), expected to be collected equally in 2019 and
2020. Sherrod was assessed a penalty...
Exercise 22-17 The reported net incomes for the first 2 years of Sage Products, Inc., were...
Exercise 22-17
The reported net incomes for the first 2 years of Sage Products,
Inc., were as follows: 2017, $160,800; 2018, $175,800. Early in
2019, the following errors were discovered.
1.
Depreciation of equipment for 2017 was overstated $17,600.
2.
Depreciation of equipment for 2018 was understated
$37,400.
3.
December 31, 2017, inventory was understated $45,000.
4.
December 31, 2018, inventory was overstated $16,400.
Prepare the correcting entry necessary when these errors are
discovered. Assume that the books are closed....
Sherrod, Inc., reported pretax accounting income of $88 million for 2018. The following information relates to...
Sherrod, Inc., reported pretax accounting income of $88 million for
2018. The following information relates to differences between
pretax accounting income and taxable income:
Income
from installment sales of properties included in pretax accounting
income in 2018 exceeded that reported for tax purposes by $7
million. The installment receivable account at year-end had a
balance of $8 million (representing portions of 2017 and 2018
installment sales), expected to be collected equally in 2019 and
2020.
Sherrod
was assessed a penalty...
The reported net incomes for the first 2 years of Shamrock Products, Inc., were as follows:...
The reported net incomes for the first 2 years of Shamrock
Products, Inc., were as follows: 2017, $146,400; 2018, $187,600.
Early in 2019, the following errors were discovered.
1.
Depreciation of equipment for 2017 was overstated $18,200.
2.
Depreciation of equipment for 2018 was understated $40,600.
3.
December 31, 2017, inventory was understated $49,300.
4.
December 31, 2018, inventory was overstated $16,000.
Goldfinch Inc. reported net incomes for the last three years as follows: 2018, $ 62,000; 2019,...
Goldfinch Inc. reported net incomes for the last three years as
follows:
2018, $ 62,000; 2019, $ 63,000; 2020, $ 60,000 In reviewing the
accounts in 2021 (after the books for the prior year had been
closed), you find that the following errors have been made:
2018 2019 2020
Overstatement of ending inventory $ 7,000 $ 8,500 $ 4,000
Understatement of accrued advertising expense 1,100 2,000
1,200
Instructions:
a) Calculate corrected net income for 2018:
$____________________
b) Calculate corrected net...
North Company has a fiscal year ending on December 31. Its financial statements for the years...
North Company has a fiscal year ending on December 31. Its
financial statements for the years ended December 31, 2016 and 2017
contained the following errors: 2016 2017 Ending inventory $19,000
understated $15,000 overstated Bad debt expense 2,000 overstated
1,000 understate Assume no correcting entries have been made. Refer
to Exhibit 22-6. By how much was North's 2017 net income overstated
or understated? $14,000 overstated $23,000 understated $7,000
understated $35,000 overstated.
The net income per books of Laura Hall Company was determined without knowledge of the errors...
The net income per books of Laura Hall Company was determined
without knowledge of the errors indicated below.
Year
Net Income
per Books
Error in Ending
Inventory
2015
$52,000
Overstated
$ 3,020
2016
54,000
Overstated
9,590
2017
56,140
Understated
10,580
2018
58,070
No error
2019
59,900
Understated
1,970
2020
61,910
Overstated
8,490
Prepare a worksheet to show the adjusted net income figure for each
of the 6 years after taking into account the inventory
errors.
Errors in Inventories
Year
Net...
ADVERTISEMENT
Need Online Homework Help?
Get Answers For Free
Most questions answered within 1 hours.
ADVERTISEMENT
Active Questions
asked 18 minutes ago
asked 22 minutes ago
asked 22 minutes ago
asked 22 minutes ago
asked 34 minutes ago
asked 43 minutes ago
asked 45 minutes ago
asked 48 minutes ago
asked 1 hour ago
asked 1 hour ago
asked 1 hour ago
asked 1 hour ago