Further consideration and review of the records revealed the following items related to the Year 5 statements. was incorrectly debited to the land account. The company uses straight-line depreciation. amortization would follow the straight-line method and that Travis intends to hold the bonds to maturity. 3. The Year 4 ending inventory was overstated by $7,000 (periodic inventory system). purchase was recorded on January 18 of Year 5 , when the invoice was paid (periodic inventory system). Required a. Prepare correcting entries that should be made on December 31 of Year 5 for each of the four errors identified. Ignore income tax effects. b. Compute the correct pretax income for Year 5. $x