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    Hit Scripts Is A Service Type Enterprise in The Entertainment Field

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    trilocksp Singh
    The document describes a balance sheet prepared by Joe Russell for his entertainment business Hit Scripts. It contains several errors regarding accounting principles, such as improperly including personal assets. A corrected balance sheet is to be prepared along with an analysis of each error listed.

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    Hit Scripts Is A Service Type Enterprise in The Entertainment Field

    Uploaded by

    trilocksp Singh
    206 views1 page
    The document describes a balance sheet prepared by Joe Russell for his entertainment business Hit Scripts. It contains several errors regarding accounting principles, such as improperly including personal assets. A corrected balance sheet is to be prepared along with an analysis of each error listed.

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    Hit Scripts is a Service Type Enterprise in the Entertainment Field

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    The document describes a balance sheet prepared by Joe Russell for his entertainment business Hit Scripts. It contains several errors regarding accounting principles, such as improperly including personal assets. A corrected balance sheet is to be prepared along with an analysis of each error listed.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    206 views1 page

    Hit Scripts Is A Service Type Enterprise in The Entertainment Field

    Uploaded by

    trilocksp Singh
    The document describes a balance sheet prepared by Joe Russell for his entertainment business Hit Scripts. It contains several errors regarding accounting principles, such as improperly including personal assets. A corrected balance sheet is to be prepared along with an analysis of each error listed.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
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    Hit Scripts is a service type enterprise in the entertainment

    field
    Hit Scripts is a service-type enterprise in the entertainment field, and its manager, Joe Russell,
    has only a limited knowledge of accounting. Joe prepared the following balance sheet, which,
    although arranged satisfactorily, contains certain errors with respect to such concepts as the
    business entity and asset valuation. Joe owns all of the corporation’s outstanding stock.In
    discussion with Joe and by inspection of the accounting records, you discover the following
    facts:1. The amount of cash, $5,000, includes $2,000 in the company’s bank account, $1,200
    on hand in the company’s safe, and $1,800 in Joe’s personal savings account. 2. One of the
    notes receivable in the amount of $600 is an IOU that Joe received in a poker game five years
    ago. The IOU is signed by “G.W.,” whom Joe met at the game but has not heard from since. 3.
    Office furniture includes $2,500 for an Indian rug for the office purchased on November 15. The
    total cost of the rug was $10,000. The business paid $2,500 in cash and issued a note payable
    to Jana Carpet for the balance due ($7,500). As no payment on the note is due until January,
    this debt is not included in the liabilities above. 4. Also included in the amount for office furniture
    is a computer that cost $800 but is not on hand because Joe donated it to a local charity. 5. The
    “Other Assets” of $25,000 represent the total amount of income taxes Joe has paid the federal
    government over a period of years. Joe believes the income tax law to be unconstitutional, and
    a friend who attends law school has promised to help Joe recover the taxes paid as soon as he
    passes the bar exam. 6. The asset “Land” was acquired at a cost of $15,000 but was increased
    to a valuation of $60,000 when one of Joe’s friends offered to pay that much for it if Joe would
    move the building off the lot. 7. The accounts payable include business debts of $30,000 and
    the $2,000 balance owed on Joe’s personal MasterCard. Instructionsa. Prepare a corrected
    balance sheet at November 30, 2011. b. For each of the seven numbered items above, use a
    separate numbered paragraph to explain whether the treatment followed by Joe is in
    accordance with generally accepted accountingprinciples.
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    Hit Scripts is a service type enterprise in the entertainment field
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    entertainment-field/

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