The Accountant for the Balboa Company Made an Error, Which

question 62

Essay

The accountant for the Balboa Company made an error, which overstated the ending inventory for 2013 by $6,000. Balboa Company uses the periodic inventory system. Assuming that this error is not caught and corrected, indicate the effect of the error on each of the following items. Write U (understated), O (overstated) or N (not affected) next to each item.
a. 2014 Beginning Inventory: _________
b. 2014 Purchases: __________
c. 2013 Goods Available for Sale: ________
d. 2013 Net Income: ________
e. 2013 Retained Earnings ending balance: __________
f. 2013 Total Assets at end of year: ___________
g. 2014 Net Income: _________
h. 2014 Retained Earnings ending balance: _________
i. 2013 Cost of Goods Sold: ___________
j. 2013 Gross Margin: _________

---

Definitions:

Southwest Asia

A geographical region that includes countries such as Turkey, Saudi Arabia, and Iran, often considered part of the Middle East.

Domestication

Domestication is the process through which humans have modified plants and animals through selective breeding for desired traits, resulting in species that differ significantly from their wild ancestors.

Zagros Mountains

A mountain range located in the western part of Iran, playing a significant role in the history and climate of the region.

Young Male Goats

Juvenile male specimens of the species Capra aegagrus hircus, commonly raised for their meat, milk, and fiber.