Determine the following as a result of your audit:a. The proposed adjusting journal entries for the year ended December 31, 2022 includes a net debit (credit) to retained earnings of?b. The proposed adjusting journal entries for the year ended December 31, 2022 includes a net debit (credit) to accumulated depreciation of? You were engaged to audit the financial statements of JBC Company for the year 2022. Thefollowing information was discovered during your audit:Audit Note I: The retained earnings account showed the following details:Retained EarningsDividends P80,000Dividends P80,000Dividends P80,000Audit Note II:AmountP1,250,000 Beginning balance450,000P20,00023,00027,00030,0001,620,000660,0002,200,000540,0002,660,000Net incomeDate PaidBalance 12/31/2020Net incomeBalance 12/31/2021During the investigation, you discovered that sales commission expenses were recorded whenpaid. Due to this, sales commissions that should have been recorded as expense and payablesin the previous year were recorded the following year. These amounts were summarized below.Net incomeBalance 12/31/2022January 10, 2020January 8, 2021January 11, 2022January 7, 2023 Other notes and observations:i.On December 31, 2020, JBC Company has goods in transit from suppliers amounting toP78,000 that was shipped FOB Destination. This was not recorded until the goods were receivedon January 10, 2021.ii.JBC Company failed to record supplies on hand at the end of 2021 and 2022 amounting toP4,500 and P3,800, respectively.iii. It was discovered through comparison of company records that dividends are not recorded inthe books until they were paid.iv.On December 31, 2020, the Company bought Land and Building for a lump sum amount ofP12,500,000 when the fair value of the land was at P9,000,000 and the building was atP6,000,000. The building has an estimated useful life of 10 years on the date of sale. The wholeamount paid was debited to Land in 2020.v.On July 1, 2021, the Company purchased a 3-year insurance policy for P300,000. The wholeamount was debited to insurance expense. No adjustments were made yet.vi.On February 12, 2023, the Company paid dividends amounting to P86,000. The date ofdeclaration was on December 15, 2022. The date of record was January 15, 2023.

During Audit, there are chances to find many discrepancies in the books of Account. In providing…

Determine the following as a result of your audit: a. The proposed adjusting journal entries for the year ended December 31, 2022 includes a net debit (credit) to retained earnings of? b. The proposed adjusting journal entries for the year ended December 31, 2022 includes a net debit (credit) to accumulated depreciation of?

Determine the following as a result of your audit: a. The proposed adjusting journal entries for the year ended December 31, 2022 includes a net debit (credit) to retained earnings of? b. The proposed adjusting journal entries for the year ended December 31, 2022 includes a net debit (credit) to accumulated depreciation of?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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