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Leslie Ltd Has Found an Error in Its Revenue Account

question 28

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
-Assuming that the dividend is unchanged,what is the effect of the error on retained profits at end of 2016?


Definitions:

Taxation

The system through which government collects money from individuals and businesses to fund public services.

Policy Decisions

Decisions taken by an organization or government based on guiding principles or regulations intended to direct actions and outcomes.

Management

The act of coordinating and overseeing the activities of a business or organization to achieve defined objectives.

Board Of Directors

A group of individuals elected by shareholders to oversee the management and make major decisions for a corporation.

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