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At Outersanctum Company, the following errors were discovered after the transactions had been journalized and posted. Prepare the necessary correcting entry for each of the following.
a. A payment of $5,000 for salaries was recorded as a debit to Supplies Expense and a credit to Cash.
b. A purchase of supplies on account for $1,000 was recorded as a debit to Equipment and a credit to Accounts Payable.
Hardware Store
A retail store specializing in the sale of tools, building materials, and home improvement products.
Music Store
A retail business specializing in the sale of musical instruments, sheet music, recordings, and related accessories.
Specific Identification
An accounting method used to track and assign costs to individual pieces of inventory, useful for unique or high-value items.
Gross Profit
The financial metric indicating the difference between revenue and the cost of goods sold before accounting for other expenses.
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