1. Office equipment purchased on January 1,2025 for $48,000 was incorrectly charged to Supplies Expense at the time of purchase. The office equipment has an estimated three-year service life with no expected salvage value. Pharoah uses the straight-line method to depreciate office equipment for financial reporting purposes. This error has not been recorded 2. The corporation disposed of its sporting goods division during 2025. This disposal meets the criteria for discontinued operations. The division correctly calculated income from operating this division of $115,000 before taxes and a loss of $13,100 before taxes on the disposal of the division. The income from the division is included in income from operations and the loss is included in other losses and expenses. The company recorded advances of $13,300 to employees made December 31 , 3. 2025 as Salaries and Wages Expense. 4. Dividends paid of $13,300 during 2025 were recorded as an operating expense. 5. In 2025, Pharoah changed its method of accounting for inventory from the first-infirst-out method to the average cost method. Inventory in 2025 was correctly recorded using the average cost method. The new inventory method would have resulted in an additional $125,000 of cost of goods sold (before taxes) being reported on prior years' income statement. 6. On January 1,2021, Pharoah bought a building that cost $91,600, had an estimated useful life of ten years, and had a salvage value of $8,600. Pharoah uses the straightline depreciation method to depreciate the building, In 2025, it was estimated that the remaining useful life was eight years and the salvage value was zero. Depreciation expense reported on the 2025 income statement was correctly