An Examination of the Accounts of Salvage Company for the Month

question 48

Essay

An examination of the accounts of Salvage Company for the month of June revealed the following errors after the transactions were journalized and posted.
1. A check for $950 from S. Wilde a customer on account was debited to Cash $950 and credited to Service Revenue $950.
2. A payment for Advertising Expense costing $720 was debited to Utilities Expense $270 and credited to Cash $270.
3. A bill for $950 for Supplies purchased on account was debited to Equipment $590 and credited to Accounts Payable $590.
Instructions
Prepare correcting entries for each of the above assuming the erroneous entries are not reversed. Explain how the transaction as originally recorded affected net income for the month of June.

---

Definitions:

Behaviourism

A theory of learning which states that all behaviors are acquired through conditioning processes influenced by the environment, without the need for thoughts or feelings.

Psychoanalysis

A therapeutic technique and theory of psychology developed by Sigmund Freud, focusing on unconscious motivations and conflicts as they influence behavior.

Humanism

A psychological perspective that emphasizes the individual's inherent drive towards self-actualization and creativity.

Personality Psychology

The study of individual differences in characteristic patterns of thinking, feeling, and behavior.