Question;Patricia Voga Company is in the process of adjusting and;correcting its books at the end of 2005. In reviewing its records, the;following information is compiled.;Voga has failed to accrue sales commissions payable at the;end of each of the last 2 years, as follows;table;In reviewing the December 31, 2005, inventory, Vega;discovered errors in its inventory-taking procedures that have caused;inventories for the last 3 years to be incorrect, as follows;table;Voga has already made an entry that established the;incorrect December 31, 2005, inventory amount.;At December 31, 2005, Voga decided to change the;depreciation method on its office equipment from double-declining balance to;straight-line. Assume that tax depreciation is higher than the double-declining;depreciation taken for each period. The following information is available.;(The tax rate is 40%.);table;Voga has already recorded the 2005 depreciation expense;using the double-declining balance method.;Before 2005, Voga accounted for its income from long-term;construction contracts on the completed-contract basis. Early in 2005, Voga;changed to the percentage-of-completion basis for both accounting and tax;purposes. Income for 2005 has been recorded using the percentage-of-completion;method. The income tax rate is 40%. The following information is available.;table;se the attached Excel file to complete this problem.;Prepare the journal entries necessary at December 31, 2005;to record the above corrections and changes. The books are still open for 2005.;Voga has not yet recorded its 2005 income tax expense and payable amounts so;current year-tax effects may be ignored. Prior-year tax effects must be;considered in items 3 and 4.
Paper#40518 | Written in 18-Jul-2015Price : $19