Scribd
Upload
17 views

Error Correction Assignment

The document provides details on an accounting assignment involving error correction for De Oro Corp. It lists accounts in the trial balance and additional information about adjustments needed for supplies on hand, accrued salaries payable, interest receivable, prepaid insurance, unearned rent, accrued interest payable, and depreciation expense. Students are asked to prepare adjusting journal entries and compute the adjusted net income.

Uploaded by

Nicole Kim
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
17 views

Error Correction Assignment

The document provides details on an accounting assignment involving error correction for De Oro Corp. It lists accounts in the trial balance and additional information about adjustments needed for supplies on hand, accrued salaries payable, interest receivable, prepaid insurance, unearned rent, accrued interest payable, and depreciation expense. Students are asked to prepare adjusting journal entries and compute the adjusted net income.

Uploaded by

Nicole Kim
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 1

ACC 221- Intermediate Accounting 3

Assignment on Error Correction

Activity 1. Problem solving


1. The following selected accounts are included in the trial balance of De Oro Corp. on
December 31, 2019:
Debit Credit
Supplies on hand 135,000
Accrued Salaries Payable 75,000
Interest Receivable 255,000
Prepaid Insurance 4,500,000
Unearned Rent -
Accrued Interest Payable 750,000

Additional information are as follows:


 A physical count of supplies on hand on December 31, 2019.
 The accountant failed to adjust the accrued salaries payable account. Accrued salaries
payable on December 31, 2019, totaled 220,000.
 The interest receivable was also left unadjusted at December 31, 2019, amounted to
217,500.
 The unexpired portions of the insurance policies totaled 3,250,000 as of December 31,
2019.
 A total of 1,400,000 were received on January 1, 2019, for the rent of a building for both
2019 and 2020. The total amount received was recognized as revenue in 2019.
 The correct amount of depreciation year was 2,500,000 but was erroneously recorded as
250,000.
 Prior years depreciation was understated by 360,000.
 Unadjusted Net Income for the year was 10,000,000

a. Prepare adjusting journal entries on December 31, 2019. Assume that the books
have not been closed
b. Compute for the adjusted net income to be reported on December 31, 2019.

You might also like