For answer blanks requiring journal entries, follow the following formatting guidelines. Your answer should be formatted as follows: debit "account name" "amount"; credit "account name" "amount" - an example is: debit accounts receivable 20,000; credit sales 20,000. Keep in mind that more than two accounts may be included in the entry. If that is the case, you will have multiple accounts credited/debited causing your answer to look more like this: debit "account name" "amount"; credit "account name" "amount"; credit"account name" "amount." Williams & Sonoma Inc. is a manufacturer of high-tech industrial parts that was started in 2009 by two talented engineers with little to no business training. In 2021, the company was acquired by one of its major customers. As part of an internal audit, the following facts were discovered. The audit occurred during 2021 before any adjusting entries or closing entries were prepared. a. A five-year casualty insurance policy was purchased at the beginning of 2019 for $35,000. The full amount was debited to insurance expense at the time. 1. Identify which of the following is represented by this situation: change in accounting principle; change in estimate; correction of an error. 2. For the situation above, provide any journal entry that would need to be immediately recorded as a direct result of the change or discovery of error. If no entry is required, enter "No entry" in the space provided. 3. For the situation above, provide any adjusting entry for 2021 related to the situation described (ignore tax effects). If no entry is required, enter "No entry" in the space provided. b. Effective January 1, 2021, the company changed the salvage value used in calculating depreciation for its office building. The building cost $600,000 on December 29, 2010, and has been depreciated on a straight-line basis assuming a useful life of 40 years and a salvage value of $100,000. Declining real estate values in the area indicate that the salvage value will be no more than $25,000. 4. Identify which of the following is represented by this situation: change in accounting principle; change in estimate; correction of an error. 5. For the situation above, provide any journal entry that would need to be immediately recorded as a direct result of the change or discovery of error. If no entry is required, enter "No entry" in the space provided. 6. For the situation above, provide any adjusting entry for 2021 related to the situation described (ignore tax effects). If no entry is required, enter "No entry" in the onaco nrovided c. On December 31, 2020, merchandise inventory was overstated by $25,000 due to a mistake in the physical inventory count using the periodic inventory system. 7. Identify which of the following is represented by this situation: change in accounting principle; change in estimate; correction of an error. 8. For the situation above, provide any journal entry that would need to be immediately recorded as a direct result of the change or discovery of error. If no entry is required, enter "No entry" in the space provided. 9. For the situation above, provide any adjusting entry for 2021 related to the situation described (ignore tax effects). If no entry is required, enter "No entry" in the space provided
