1. prepare the journal entries to correct the errors ignore, Ask an Expert

Accounting

In 2009, the internal auditors of KJI Manufacturing discovered the following material errors made in prior years:

1. Equipment was purchased on June 30, 2007, for $100,000. The purchase was incorrectly recorded as a debit to repair and maintenance expense. The equipment has a useful life of five years and no residual value.

2. On March 31, 2008, $50,000 was paid to a contractor to landscape the area around a manufacturing plant including the installation of a sprinkler system. The expenditure was debited to the Land account. The landscaping is expected to have a 20-year useful life and no residual value.

KJI uses the straight-line method of depreciation for all depreciable assets.

Required:

1. Prepare the journal entries to correct the errors (ignore income taxes).

2. Prepare the journal entries to record 2009 depreciation for any assets record in requirement.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9450141

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