Poor planning or poor project management is the number one reason why projects fall behind schedule or fail. We all know how important it is to plan before acting, even more in the area of management of the different areas of the project, it is important to define the objectives of the project from day one, defining them will mean success or failure of the project and from this point to advance in the planning of all areas before starting to do any work.
When Prior year ending inventory understated by $ 50,000 :
If the ending inventory of the prior year has been understated then the COGS of the prior year get overstated which ultimately understated Pretax income by the same margin.
Prior year ending inventory is the current year opening inventory, so when the prior year ending inventory has been understated that means the current year opening inventory is also getting understated. Which resulted in an understatement of COGS and due to which pretax income of the current year gets overstated by the same margin.
Total pretax income of the two years = $ (50,000) + $ 50,000 = Nil ( No effect).
The four most commonly used inventory types are Raw Materials, Work in Process (WIP), Finished Goods, Maintenance, Repair, and Overhaul (MRO). Knowing the nature of your inventory will help you manage your inventory better and smarter. Consider a fashion retailer like Zara, which operates seasonally.
Learn more about inventory at
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Answer:
a. Bad Debt Expense 5100 Allowance for Doubtful Accounts 5100
Explanation:
The adjusting entry is shown below:
Bad debt expense $5,100
To Allowance for doubtful debts $5,100
(Being the bad debt expense is recorded)
The computation is shown below:
= Account receivable × estimated percentage - credit balance of allowance for doubtful debts
= $170,000 × 5% - $3,400
= $8,500 - $3,400
= $5,100
In order to recording this transaction, we debited the bad debt expense as it increases the expenses account whereas at the same time it reduces the account receivable therefore the allowance for doubtful debts is credited
Answer:
Supplier bills payable in 30 days
Explanation:
This is current assets
- Certificates of deposit that mature in six months
- Cash
- Customer receivables
The Supplier bills payable in 30 days is a current liability
