The Jessica Co. has the following errors on its books as of December 31, 2020. The books for 2020 have not yet been closed. a. On January 1, 2018, a machine had been purchased for $6,500. The machine had an estimated life of five years, but it was expensed in error. Straight-line depreciation with no salvage value should have been used. b. On January 1, 2019, the company bought a four-year insurance policy for $800 and immediately charged the full premium to expense.   Required:   Prepare journal entries to correct these errors on December 31, 2020. Ignore income taxes.

Wardell Company purchased a mini computer on January 1, 2022, at a cost of $41,700. The computer has been depreciated using the straight-line method over an estimated five-year useful life with an estimated residual value of $4,200. On January 1, 2024, the estimate of useful life was changed to a total of 10 years, and the estimate of residual value was changed to $900. Required: 1. Prepare the appropriate adjusting entry for depreciation in 2024 to reflect the revised estimate. 2. Prepare the appropriate adjusting entry for depreciation in 2024 to reflect the revised estimate, assuming that the company uses the sum-of-the-years'-digits method instead of the straight-line method. Required 1 Required 2 Prepare the appropriate adjusting entry for depreciation in 2024 to reflect the revised estimate, assuming that the company uses the sum-of-the-years'-digits method instead of the straight-line method. Note: If no entry is required for a transaction/event, select "No journal entry…

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Skysong Corp. purchased machinery on January 1, 2019 for $692,000. Straight-line depreciation is used. At the time management estimated that the machinery would be used over 10 years and would have a residual value of $47,000. It is now December 31, 2023 and management has determined that the machine's life is now a total of 12 years with no residual value. No adjusting journal entries have been recorded yet for the 2023 year-end.

Wildhorse Co. purchased machinery that cost $2850000 on January 4, 2019. The entire cost was recorded as an expense. The machinery has a 9-year life and a $185000 residual value. The error was discovered on December 20, 2021. Ignore income tax considerations.Wildhorse's income statement for the year ended December 31, 2021, should show the cumulative effect of this error in the amount of

In 2021, internal auditors discovered that PKE Displays, Inc. had debited an expense account for the $356,000 cost of equipment purchased on January 1, 2018. The equipment’s life was expected to be five years with no residual value. Straight-line depreciation is used by PKE. Required:1. Determine the cumulative effect of the error on net income over the three-year period from 2018 through 2020, and on retained earnings by the end of 2020.2. Prepare the correcting entry assuming the error was discovered in 2021 before the adjusting and closing entries. (Ignore income taxes.)3. Assume instead that the equipment was disposed of in 2022 and the original error was discovered in 2023 after the 2022 financial statements were issued. Prepare the correcting entry in 2023.

Crane Corporation uses straight-line depreciation, prepares adjusting entries annually, and has a December 31 year end. It purchased equipment on January 1, 2020, for $196,400. The equipment had an estimated useful life of five years and a residual value of $20,440. On December 31, 2021, the company tests for impairment and determines that the equipment's fair value is $95,600. (a) (b) Your answer has been saved. See score details after the due date. Assuming annual depreciation has already been recorded at December 31, calculate the equipment's carrying amount at December 31, 2021, immediately after recording depreciation for the year. Carrying amount Calculate the amount of the impairment loss, if any. Impairment loss $ 126016 Save for Later Attempts: 1 of 1 used Attempts: 0 of 1 used Submit Answer

On December 12, 2018, an investment costing $88,000 was sold for $116,000. The total of the sale proceeds was credited to the investment account. Required:1. Prepare the journal entry to correct the error assuming it is discovered before the books are adjusted or closed in 2018. (Ignore income taxes.)2. Prepare the journal entry to correct the error assuming it is not discovered until early 2019. (Ignore income taxes.)