Acue Company reported current assets of P3,900,000 and current liabilities of P2,000,000 on its statement of financial position as of December 31, 2017. The following items may have been recorded incorrectly. The company uses the periodic inventory system. Goods purchased costing P220,000 were shipped FOB shipping point by a vendor on December 26. Acue received and recorded the invoice on December 29, 2017, but the goods were not included in Acue’s physical count of inventory because they were not received until January 4, 2018. Goods purchased costing P200,000 were shipped FOB destination by a supplier on December 28. Acue received and recorded the invoice on December 31, but the goods were not included in Acue’s 2017 physical count of inventory because they were not received until January 2, 2018. Goods held on consignment from Si Company were included in Acue’s December 31, 2017, physical count of inventory at P130,000. By what amount will income (before taxes) be adjusted up or down as a result of the corrections?Group of answer choices110,000 decrease290,000 increase110,000 increase290,000 decrease PreviousNext

Name: Acue Company reported current assets of P3,900,000 and current liabili
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Description: Acue Company reported current assets of P3,900,000 and current liabilities of P2,000,000 on its statement of financial position as of December 31, 2017. The following items may have been recorded incorrectly. The company uses the periodic inventory s

Transaction current assets current liabilities Income - Increase (Decrease) P3,900,000…

Answered: Acue Company reported current assets of…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Acue Company reported current assets of P3,900,000 and current liabilities of P2,000,000 on its statement of financial position as of December 31, 2017. The following items may have been recorded incorrectly. The company uses the periodic inventory system.

Goods purchased costing P220,000 were shipped FOB shipping point by a vendor on December 26. Acue received and recorded the invoice on December 29, 2017, but the goods were not included in Acue’s physical count of inventory because they were not received until January 4, 2018.

Goods purchased costing P200,000 were shipped FOB destination by a supplier on December 28. Acue received and recorded the invoice on December 31, but the goods were not included in Acue’s 2017 physical count of inventory because they were not received until January 2, 2018.

Goods held on consignment from Si Company were included in Acue’s December 31, 2017, physical count of inventory at P130,000.

By what amount will income (before taxes) be adjusted up or down as a result of the corrections?

Group of answer choices

110,000 decrease

290,000 increase

110,000 increase

290,000 decrease

PreviousNext

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

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