A Client Has Asked You to Review and Correct the Following

question 157

Essay

A client has asked you to review and correct the following income statement:
Additional information:
a.A $3,500 machine tune-up was recorded as an asset.
b.The costs of buying a $120,000 piece of equipment on the last day of the fiscal year were treated as equipment expense.
c.An asset with a cost of $230,000,a 10-year useful life,and a zero salvage value was depreciated $23,000 for the full year.
d.The power and electricity costs of running a machine were treated as an expense for the year.The costs amounted to $56,000.
e.The costs of insuring a piece of equipment while it was in transit amounted to $5,000,and those costs were capitalized.
Required:
1.List any errors that you find.
2.Correct the errors and prepare another income statement.

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Definitions:

Subarachnoid Space

The area between the arachnoid membrane and pia mater around the brain and spinal cord, containing cerebrospinal fluid.

Cerebrospinal Fluid

The clear, colorless body fluid found in the brain and spinal cord, providing cushioning and maintaining a stable environment.

Bone Marrow Aspiration

A medical procedure that involves extracting a sample of the liquid part of bone marrow to examine for diseases or conditions.

Medullary Canals

The central cavities within bones where marrow is stored, playing a key role in the formation of blood cells.