Leslie Ltd Has Found an Error in Its Revenue Account

question 36

Multiple Choice

Leslie Ltd has found an error in its revenue account: an invoice for $3000 was recorded as revenue in 2015 when it should have been recorded in 2016.The company's income tax rate is 40 per cent and there was no corresponding error in cost of goods sold.
-What is the effect of the error on 2016 net profit?

• A) It is $1800 too low.
• B) It is $3000 too low.
• C) It is $1800 too high.
• D) It is $3000 too high.

---

Definitions:

Duodenal Ulcer

A type of peptic ulcer that occurs in the first part of the small intestine, resulting in stomach pain and discomfort.

Gastric Ulcer

A type of peptic ulcer that occurs on the lining of the stomach, causing pain, indigestion, and, in severe cases, bleeding or perforation.

Appendicitis

Inflammation of the appendix, a condition that typically requires surgical removal of the appendix.

Cholecystitis

Inflammation of the gallbladder, often due to gallstones blocking the ducts leading to severe pain and digestive problems.