Adjusting entries for depreciation; effect of error On December 31, a business estimates depreciation on equipment used during the first year of operations to be $13,900. a. Journalize the adjusting entry required as of December 31. If an amount box does not require an entry, leave it blank. Dec. 31 b. If the adjusting entry in (a) were omitted, which items would be erroneously stated on the income statement for the year? Depreciation Expense Net Income If the adjusting entry in (a) were omitted, which items would be erroneously stated on the balance sheet as of December 31? Accumulated Depreciation Total Assets Owner's Equity

Adjusting entries for depreciation; effect of error On December 31, a business estimates depreciation on equipment used during the first year of operations to be $13,900. a. Journalize the adjusting entry required as of December 31. If an amount box does not require an entry, leave it blank. Dec. 31 b. If the adjusting entry in (a) were omitted, which items would be erroneously stated on the income statement for the year? Depreciation Expense Net Income If the adjusting entry in (a) were omitted, which items would be erroneously stated on the balance sheet as of December 31? Accumulated Depreciation Total Assets Owner's Equity

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Exercise 15. Adjusting entries for depreciation; effect of error On December 31, a business estimates depreciation on equipment used during the first year of operations to be P8,500. If the adjusting entry were omitted, which items would be erroneously stated on (1) the SCI for the year and (2) the SFP as F December 31?
Recording a Change in Estimate, an Error Correction, and a Change in Accounting Principle On December 31, Year 4, Alexa Company is preparing adjusting entries for its annual year-end. The following issues confront the company. 1. Equipment #101 with a cost of $12,320 was purchased three years earlier on January 1, Year 2. It is being depreciated on a straight-line basis over an estimated useful life of 10 years with no residual value. At December 31, Year 4, it has been determined that the estimated total useful life is 6 years instead of 10. 2. Equipment # 502 with a cost of $7,280 was purchased four years earlier on January 1, Year 1. It is being depreciated on a straight-line basis over an estimated useful life of seven years with no residual value. At December 31, Year 4, it was discovered that no depreciation had been recorded on this equipment for Year 1 or Year 2, but it was recorded for Year 3. 3. In Year 4, Alexa decided to change Inventory methods from the weighted-average…
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