Conrad Playground Supply underwent a restructuring in $2024.$ The company conducted a thorough internal audit, during which the following facts were discovered. The audit occurred during $2024$ before any adjusting entries or closing entries are prepared.

Additional computers were acquired at the beginning of $2022$ and added to the company$$s office network. The $$43,000$ cost of the computers was inadvertently recorded as maintenance expense. Computers have five$-$year useful lives and no material salvage value. This class of equipment is depreciated by the straight$-$line method.

Two weeks prior to the audit, the company paid $$15,000$ for assembly tools and recorded the expenditure as office supplies. The error was discovered a week later.

On December $31,2023,$ merchandise inventory was understated by $$74,000$ due to a mistake in the physical inventory count. The company uses the periodic inventory system.

Two years earlier, the company recorded a $5\%$ stock dividend $(1,600$ common shares, $$1$ par$)$ as follows:

Account NameDebitCreditRetained earnings$1,600$Common stock$1,600$

The shares had a market price at the time of $$11$ per share.

At the end of $2023,$ the company failed to accrue $$96,000$ of interest expense that accrued during the last four months of $2023$ on bonds payable. The bonds, which were issued at face value, mature in $2028.$ The following entry was recorded on March $1,2024,$ when the semiannual interest was paid, as well as on September $1$ of each year:

Account NameDebitCreditInterest expense$144,000$Cash$144,000$

A three$-$year liability insurance policy was purchased at the beginning of $2023$ for $$70,800.$ The full premium was debited to insurance expense at the time.

Required:

For each error, prepare any journal entry necessary to correct the error, as well as any year$-$end adjusting entry for $2024$ related to the situation described. $($Ignore income taxes.$)$

Note: If no entry is required for a transaction$/$event$,$ select $"$No journal entry required" in the first account field.

e$.$ At the end of $2023,$ the company failed to accrue $\backslash (\backslash$$ $96,000\backslash )$ of interest expense that accrued during the last four months of $2023$ on bonds payable. The bonds, which were issued at face value, mature in $2028.$ The following entry was recorded on March $1,2024,$ when the semiannual interest was paid, as well as on September $1$ of each year:

f$.$ A three$-$year liability insurance policy was purchased at the beginning of $2023$ for $\backslash (\backslash$$ $70,800\backslash ).$ The full premium was debited to insurance expense at the time.

Required:

For each error, prepare any journal entry necessary to correct the error, as well as any year$-$end adjusting entry for $2024$ related to the situation described. $($Ignore income taxes.$)$

Note: If no entry is required for a transaction$/$event$,$ select $"$No journal entry required" in the first account field.

Journal entry worksheet

$1$

$2$

$3$

$4$

$5$

$6$

$7$

$812$

Record entry necessary for error correction.

Note: Enter debits before credits.

e$.$ At the end of $2023,$ the company failed to accrue $\backslash (\backslash$$ $96,000\backslash )$ of interest expense that accrued during the last four months of $2023$ on bonds payable. The bonds, which were issued at face value, mature in $2028.$ The following entry was recorded on March $1,2024,$ when the semiannual interest was paid, as well as on September $1$ of each year:

f$.$ A three$-$year liability insurance policy was purchased at the beginning of $2023$ for $\backslash (\backslash$$ $70,800\backslash ).$ The full premium was debited to

insurance expense at the time.

Required:

For each error, prepare any journal entry necessary to correct the error, as well as any year$-$end adjusting entry for $2024$ related to the situation described. $($Ignore income taxes.$)$

Note: If no entry is required for a transaction$/$event$,$ select $"$No journal entry required" in the first account field.

Journal entry worksheet

Record adjusting journal entry for $2024.$

Note: Enter debits before credits.

e$.$ At the end of $2023,$ the company failed to accrue $\backslash (\backslash$$ $96,000\backslash )$ of interest expense that accrued during the last four months of $2023$ on bonds payable. The bonds, which were issued at face value, mature in $2028.$ The following entry was recorded on March $1,2024,$ when the semiannual interest was paid, as well as on September $1$ of each year:

f$.$ A three$-$year liability insurance policy was purchased at the beginning of $2023$ for $\backslash (\backslash$$ $70,800\backslash ).$ The full premium was debited to

insurance expense at the time.

Required:

For each error, prepare any journal entry necessary to correct the error, as well as any year$-$end adjusting entry for $2024$ related to the situation described. $($Ignore income taxes.$)$

Note: If no entry is required for a transaction$/$event$,$ select $"$No journal entry required" in the first account field.

Journal entry worksheet

Record entry necessary for error correction.

Note: Enter debits before credits.