Lindy Company's auditor discovered two errors.No errors were corrected during 2015.The errors are described as follows:
(1. )Merchandise costing $4,000 was sold to a customer for $9,000 on December 31,2015,but it was recorded as a sale on January 2,2016.The merchandise was properly excluded from the 2015 ending inventory.Assume the periodic inventory system is used.
(2. )A machine with a five-year life was purchased on January 1,2015.The machine cost $20,000 and has no expected salvage value.No depreciation was taken in 2015 or 2016.Assume the straight-line method for depreciation.
Required:
Prepare appropriate journal entries (assume the 2016 books have not been closed).Ignore income taxes.

Question

Quizplus · Accepted Answer

The Answer of Lindy Company's auditor discovered two errors.No errors were corrected during 2015.The errors are described as follows:
(1. )Merchandise costing $4,000 was sold to a customer for $9,000 on December 31,2015,but it was recorded as a sale on January 2,2016.The merchandise was properly excluded from the 2015 ending inventory.Assume the periodic inventory system is used.
(2. )A machine with a five-year life was purchased on January 1,2015.The machine cost $20,000 and has no expected salvage value.No depreciation was taken in 2015 or 2016.Assume the straight-line method for depreciation.
Required:
Prepare appropriate journal entries (assume the 2016 books have not been closed).Ignore income taxes.

Lindy Company's Auditor Discovered Two Errors