QUESTION 3 (20 MARKS) Daisy Enterprise specializes in English courses and it usually updates its...
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QUESTION 3 (20 MARKS) Daisy Enterprise specializes in English courses and it usually updates its accounting records daily. The following transactions took place in the business. Indicate the effect of the following errors on each of the accounting elements described in the column heading below, using the following code: o = overstated U = understated NE = no effect Net Total Error Total Owner's Liabilities Equity Profit Assets U U NE U Example: Received $200 cash for services rendered to a customer, but recorded the transactions as $20 a) The owner withdrew $1,500 for her family use. It was recorded as DR. Other expense CR. Cash b) Paid $2,000 for telephone expense by cash. It was recorded twice. c) Provided a personal English course to a client for $5,000 on credit basis. This transaction has not been recorded. d) Payment for insurance was in advance for $7,000 on credit basis. It was recorded as DR. Prepaid insurance CR. Cash e) Bought and paid $7,000 for an office equipment. No entry was made at all on this purchase. QUESTION 4 (20 MARKS)
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