The Following Errors in Recording the Transactions for June Were

question 24

Essay

The following errors in recording the transactions for June were discovered in the general journal the next month after the data had been posted to the ledger.Record the necessary correcting entries on page 2 of a general journal.Omit the descriptions.

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Definitions:

Credit

The trust which allows one party to provide money or resources to another party wherein the second party does not reimburse the first party immediately but promises either to repay or return those resources at a later date.

Cash Cycle

The period between the outlay of cash for the purchase of raw materials and the collection of cash from the sale of products, measuring how efficiently a company manages its working capital.

Inventory Period

The average time it takes for a company to turn its inventory into sales.

Accounts Receivable Period

Also known as days sales outstanding (DSO), it measures the average number of days it takes for a company to collect payment after a sale has been made.