In 2020, Lion CPA's became the auditor of Tinman Company and discovered 2 errors. Scarecrow Company CPA's were Tinman's auditor in 2019 and did not find any errors. 1. On January 1st 2019 Tinman Company purchased a flying broom for $20,000. The flying broom has an estimated life of 5 years with no salvage value and no depreciation was taken in either 2019 or 2020. 2. Inventory costing Tinman $4000 was sold to OZ Company during December 2019, but the sale wasn't recorded until OZ paid $9000 for the inventory on January 5th 2020. Tinman uses periodic inventory method and the 2019 count of inventory did NOT include the merchandise sold to OZ since it wasn't in Tinman's warehouse. REQUIRED prepare the appropriate journal entries for 2020. Assume the 2020 books have not been closed.
In 2020, Lion CPA's became the auditor of Tinman Company and discovered 2 errors. Scarecrow Company CPA's were Tinman's auditor in 2019 and did not find any errors. 1. On January 1st 2019 Tinman Company purchased a flying broom for $20,000. The flying broom has an estimated life of 5 years with no salvage value and no depreciation was taken in either 2019 or 2020. 2. Inventory costing Tinman $4000 was sold to OZ Company during December 2019, but the sale wasn't recorded until OZ paid $9000 for the inventory on January 5th 2020. Tinman uses periodic inventory method and the 2019 count of inventory did NOT include the merchandise sold to OZ since it wasn't in Tinman's warehouse. REQUIRED prepare the appropriate journal entries for 2020. Assume the 2020 books have not been closed.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:In 2020, Lion CPA's became the auditor of Tinman Company and discovered 2 errors. Scarecrow Company CPA's were
Tinman's auditor in 2019 and did not find any errors.
1. On January 1st 2019 Tinman Company purchased a flying broom for $20,000. The flying broom
has an estimated life of 5 years with no salvage value and no depreciation was taken in either 2019
or 2020.
2. Inventory costing Tinman $4000 was sold to OZ Company during December 2019, but the
sale wasn't recorded until OZ paid $9000 for the inventory on January 5th 2020. Tinman
uses periodic inventory method and the 2019 count of inventory did NOT include the
merchandise sold to OZ since it wasn't in Tinman's warehouse.
REQUIRED
prepare the appropriate journal entries for 2020. Assume the 2020 books have not been closed.
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