BVC began operations January 1, 20x1.Financial statements for the year ended December 31, 20x1, and 20x2, contained the following errors: In addition, on December 26, 20x2, fully depreciated machinery was sold for $21,600 cash, but the sale was not recorded until 20x3. There were no other errors during 20x1 or 20x2, and no corrections have been made for any of the errors.
What is the total pre-tax effect of the errors on 20x2 net income?

Question

BVC began operations January 1, 20x1.Financial statements for the year ended December 31, 20x1, and 20x2, contained the following errors:  In addition, on December 26, 20x2, fully depreciated machinery was sold for $21,600 cash, but the sale was not recorded until 20x3. There were no other errors during 20x1 or 20x2, and no corrections have been made for any of the errors.
What is the total pre-tax effect of the errors on 20x2 net income?

Quizplus · Accepted Answer

The Answer of BVC began operations January 1, 20x1.Financial statements for the year ended December 31, 20x1, and 20x2, contained the following errors:  In addition, on December 26, 20x2, fully depreciated machinery was sold for $21,600 cash, but the sale was not recorded until 20x3. There were no other errors during 20x1 or 20x2, and no corrections have been made for any of the errors.
What is the total pre-tax effect of the errors on 20x2 net income?

BVC Began Operations January 1, 20x1