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problem: Describe where in each of the following items should appear in the financial statements of a corporation:

[A]    The company grants 5 of its employees the option to purchase 100 shares of it USD 5 par value common stock at its current market price of USD 20 per share anytime with the next 5 years. None of the employees exercised the options in the current year.

[B]     The accounting departs discovered that an entry was made last year to Prepaid Insurance instead of to Insurance Expense. The after tax effect of the charge to Prepaid Insurance was USD 11,000

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