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:

Political Influence

The capacity to affect government actions, policies, or decisions through various forms of advocacy or persuasion.

High Birth Rate

A demographic scenario where the number of live births per thousand people in a population is significantly above the average.

Low Outgroup Marriage

The infrequent occurrence of marriages or unions between members of different social, ethnic, or cultural groups.

Linguistic Relativity

The hypothesis that the structure of a language affects its speakers' worldview or cognition.