The current assets and current liabilities sections of the balance sheet of Ayay

Question

The current assets and current liabilities sections of the balance sheet of Ayayai Company appear as follows.

AYAYAI COMPANY
BALANCE SHEET (PARTIAL)
DECEMBER 31, 2017

The following errors in the corporation’s accounting have been discovered:

Cash, not including cash sales, collected in January 2018 and entered as of December 31, 2017, totaled $36,304. Of this amount, $24,304 was received on account after cash discounts of 2% had been deducted; the remainder represented the proceeds of a bank loan.

please tell me how to get answer

AYAYAI COMPANY
BALANCE SHEET (PARTIAL)
DECEMBER 31, 2017

Cash $ 46,800 Accounts payable $  55,740 Accounts receivable $94,800 Notes payable 68,130     Less: Allowance for doubtful accounts 7,660 87,140 $123,870 Inventory 166,770 Prepaid expenses 9,030 $309,740 Your answer is correct. Calculate the following adjusted balances. Cash 41280 Accounts Receivable Inventory Accounts Payable Notes Payable 155850 114100 56130

Explanation / Answer

Balance before error - Adjusted Balance = Net Change Cash $           46,800 - $         41,280 = $    5,520 Accounts Receivable $           94,800 - $         98,990 = $   -4,190 Inventory $       1,66,770 - $      1,55,850 = $ 10,920 Total (A) = $ 12,250 Accounts Payable $           55,740 - $      1,14,100 = $-58,360 Notes Payable $           68,130 - $         56,130 = $ 12,000 Total (B) = $-46,360 Decrease to Retained earnings (A) - (B) = $ 58,610

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