80.2K

Verified Solution

Link Copied!

On July 9, 2021, Pharoah Enterprises Inc. discovered it had recorded the $69,000 purchase of land as legal expense on November 8, 2020. The company had reported retained earnings of $527,500 at its previous year end, December 31, 2020. During 2021, Pharoah had profit of $178,000 and it declared and paid cash dividends of $199,000. Pharoah has a 25% income tax rate.

Prepare the journal entry to correct the error. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Date	Account Titles and Explanation	Debit	Credit
Jan. 1		enter a debit amount	enter a credit amount
	enter a debit amount	enter a credit amount
		enter a debit amount	enter a credit amount
	(To record correction of error.)

Question Part Score

--/3

Assuming the company reports under ASPE, prepare a statement of retained earnings. (List items that increase retained earnings first.)

PHAROAH ENTERPRISES INC. Statement of Retained Earnings choose the accounting period
select an opening name	$enter a dollar amount
select between addition and deduction AddLess: select an item	enter a dollar amount
select a summarizing line for the first part	enter a total amount for the first part
select between addition and deduction AddLess: select an item Balance, January 1 a	enter a dollar amount
	enter a subtotal of the two previous amounts
enter a dollar amount
$enter a total amount

Answer & Explanation Solved by verified expert

See Answer