The controller of Mingus \& Mingus Inc., a construction company, provides you with the following schedule of additions and disposals to fixed assets for the past year:

The following account balances were obtained from the financial statements from last year and the trial balance (unaudited) from this year:

Assuming that the depreciation expense for 2007 does not include any depreciation taken on the assets listed above, and that Mingus \& Mingus Inc. uses the straight-line method of depreciation with no salvage values, do you have evidence of misstatement here? If so, where? Restate the balances to correctly reflect the activity shown.

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Accumulated Disposals Crane #8 Original Cost Depreciation Taken $470,000 $310,000 Bulldozer #20 140,000 60,000 Bulldozer #11 170,000 100,000 Acquisitions Cost Estimated Life Backhoe #19 $90,000 10 yrs. Backhoe #20 80,000 10 yrs. Amount Received $180,000 50,000 Bulldozer (FMV = $80,000)