problem 1: A Milling machine purchased for $8,000 in the year January 2007 is expected to last for 5 years with no scrap value. Depreciation is computed on a straight line basis.
Show the entries in the Provision for Depreciation account for 5-years.
problem 2: Lilac Ltd.’s income statement at 31st December 2010 showed a total profit of $ 12,540. Then a verification of the accounts revealed the given errors:
a) Sales account was under cast by $ 650
b) Discount received of $115 was not posted to the discount received account.
c) Plant and machinery account was under cast by $650
d) A cash sales of $115 was posted to sales a/c however was omitted from the cash a/c.
e) A cash purchase of goods for resale $ 800 was credited to cash account however the debit entry was made in the Office Furniture account.
f) Commissions received of $312 were entered in the cash account however omitted from Commissions Received account.
Prepare journal entries to correct the above errors.