Lindy Company's Auditor Discovered Two Errors

question 76

Essay

Lindy Company's auditor discovered two errors. No errors were corrected during 2008. The errors are described as follows:
(1.) Merchandise costing $4,000 was sold to a customer for $9,000 on December 31, 2008, but it was recorded as a sale on January 2, 2009. The merchandise was properly excluded from the 2008 ending inventory. Assume the periodic inventory system is used.
(2.) A machine with a 5-year life was purchased on January 1, 2008. The machine cost $20,000 and has no expected salvage value. No depreciation was taken in 2008 or 2009. Assume the straight-line method for depreciation.
Required:
Prepare appropriate journal entries (assume the 2009 books have not been closed). Ignore income taxes.

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Definitions:

Early Ambulation

The practice of encouraging patients to walk and move around soon after surgery to promote faster recovery.

Deep Breathing

A relaxation technique that involves inhaling slowly and deeply through the nose, filling the lungs, and then exhaling gradually to reduce stress and increase oxygen levels in the blood.

Chronic Obstructive Pulmonary Disease (COPD)

A group of lung diseases that block airflow and make it difficult to breathe, including conditions like emphysema and chronic bronchitis.

Oxygen Saturation

A measure of the amount of oxygen carried by hemoglobin in the blood, expressed as a percentage of the maximum amount the blood can carry.