Use the Following Information for Questions

question 14

Multiple Choice

Use the following information for questions.
Cheyenne Ltd.'s December 31 year-end financial statements contained the following errors: An insurance premium of $ 3,600 was prepaid in 2019 covering the calendar years 2019, 2020, and 2021. This had been debited to insurance expense. In addition, on December 31, 2020, fully depreciated machinery was sold for $ 1,900 cash, but the sale was not recorded until 2021. There were no other errors during 2020 or 2021 and no corrections have been made for any of the errors. Ignore income tax considerations.
-Counterbalancing errors do NOT include

• A) errors that correct themselves in two years.
• B) errors that correct themselves in three or more years.
• C) an understatement of ending inventory.
• D) an overstatement of unearned revenue.

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Definitions:

Groin Pain

Discomfort or pain located in the area where the abdomen ends and the legs begin.

Recreational Drugs

Substances taken for pleasure rather than for medical reasons, often leading to changes in consciousness, mood, or perception.

Sexual Enjoyment

The experience of pleasure, satisfaction, or fulfillment derived from sexual activities.

Cervical Cancer

A type of cancer that occurs in the cells of the cervix, often associated with infection by Human Papillomavirus (HPV).