The accountant for glacier medical co., a medical services consulting firm mistakenly omitted adjusting entries for a)unearned revenue earned during the year ($10,390) and b)accured wages ($2,440).
Indicate the effect of each error, considered individually, on the income statement for the current year ended december 31. Also indicate the effect of each error on the december 31 balance sheet. Set up a similar table to the following, and record your answers by inserting the dollar amount in the appropriate spaces. Insert a zero if the error does not affect the item.
Overstated Understated 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 for the year would be
5. Liabilities for the year would be
6. Stockholders' equity at December 31 would be