Ch+4%282%29+Note+Posting+-+Additional+Qs - Chapter 4(2)...

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Chapter 4(2) – Additional Question The following transactions were made in the accounting records of BuBu Co. In preparing the 2009 year-end adjustments, you, the accounting assistant, are required to (1) identify the mistakes, their impacts (i.e. overstatement, understatement, or no effect) on accounts and financial statements, and (2) record all journal entries and adjusting entries. . 1. A one-year insurance policy was purchased on April 1, for $2,400. The transaction was recorded in the Insurance Expense account. 2. An automobile was purchased on August 1 for $40,000. The company would like to use this car for 4 years and expects to receive $4,000 when it sells the car at the end of the 4th year. The whole year of depreciation was recorded in the Automobile account. 3. On October 5, BuBu paid 6 months rent of a total of $6,000. The transaction was recorded in the Rent Expense account. 4.
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This note was uploaded on 06/18/2011 for the course MGT b05 taught by Professor Liang during the Spring '11 term at University of Toronto- Toronto.

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Ch+4%282%29+Note+Posting+-+Additional+Qs - Chapter 4(2)...

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