In 2013, the Internal Auditors of Blooper Inc

question 109

Essay

In 2013, the internal auditors of Blooper Inc. discovered that goods costing $12 million that were shipped f.o.b. shipping point in December of 2012 were in transit on December 31. The goods were recorded as a purchase in December of 2012 but were not included in the 2012 year-end inventory.
Required:
Prepare the journal entry needed in 2013 to correct the error. Also, briefly describe any other measures Blooper would take in connection with correcting the error. (Ignore income taxes.)

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Definitions:

British North America Act

The foundational statute passed by the British Parliament in 1867, creating the Dominion of Canada by union of several colonies.

Constitution Act

A fundamental law or group of laws outlining the system of government of a country, its institutions, and the rights of citizens.

Supremacy of Parliament

The legal principle that the laws and statutes passed by a country's parliament are supreme and cannot be overridden by any other body.

Section 33

Often referred to as the "notwithstanding clause," it allows Canadian federal or provincial governments to pass laws that temporarily override certain sections of the Charter of Rights and Freedoms.