Indicate the effect of the following errors on each of the financial statement elements described in the column headings in the table below. Use the following symbols: 0 = overstated, U = understated, and NE = no effect.
Error | Net Income | Total Assets | Total Liabilities | Retained Earnings |
a. Recorded a dividend as an expense in the income statement. |
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b. Recorded unearned revenue as earned revenue in the income statement. |
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c. Failed to record accrued wages payable at the end of the accounting period. |
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d. Recorded a declared but unpaid dividend by debiting Dividends and crediting Cash. |
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e. Failed to disclose a pending lawsuit in the notes accompanying the financial statements. |
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