Lancaster Company is in the process of closing its books at the end of 2021 . The company's preliminary income statement for 2021 and its reported income statement for 2020 are given below. Lancaster's records reveal the following information: (1) Lancaster failed to accrue $9,000 of commissions expense at the end of 2020 . The commissions expense was recorded as paid in 2021. (2) On 1/1/19, Lancaster purchased a machine for $150,000. Although the machine was expected to have a five-year life, it was erroneously expensed in recording the purchase. The appropriate depreciation method for this machine is double-declining-balance with no residual. (3) At the end of 2021, Lancaster decided to change its inventory costing method from the FIFO costing method to the average cost method. An analysis of the accounting records provides the following cost of goods sold amounts under average cost and FIFO: (4) Lancaster acquired a machine on 1/3/19 for $90,000 and estimated its useful life to be 6 years with a salvage value of \$15,000. In 2021, after the preliminary statements were prepared, Lancaster realized that the machine could be used for an additional 5 years, but that the salvage value at the end of that time would probably be only $10,000. Straight-line depreciation is being used. c. Retained earnings reported for the end of 2020 was $2,295,000 and at the end of 2019 was $2,112,000. Dividends of $60,000 were declared in each year. Prepare comparative statements of retained earnings for Lancaster Company for 2021 and 2020 , reflecting appropriate adjustments from items (1)-(4) above, ignoring income taxes. Lancaster Company is in the process of closing its books at the end of 2021 . The company's preliminary income statement for 2021 and its reported income statement for 2020 are given below. Lancaster's records reveal the following information: (1) Lancaster failed to accrue $9,000 of commissions expense at the end of 2020 . The commissions expense was recorded as paid in 2021. (2) On 1/1/19, Lancaster purchased a machine for $150,000. Although the machine was expected to have a five-year life, it was erroneously expensed in recording the purchase. The appropriate depreciation method for this machine is double-declining-balance with no residual. (3) At the end of 2021, Lancaster decided to change its inventory costing method from the FIFO costing method to the average cost method. An analysis of the accounting records provides the following cost of goods sold amounts under average cost and FIFO: (4) Lancaster acquired a machine on 1/3/19 for $90,000 and estimated its useful life to be 6 years with a salvage value of \$15,000. In 2021, after the preliminary statements were prepared, Lancaster realized that the machine could be used for an additional 5 years, but that the salvage value at the end of that time would probably be only $10,000. Straight-line depreciation is being used. c. Retained earnings reported for the end of 2020 was $2,295,000 and at the end of 2019 was $2,112,000. Dividends of $60,000 were declared in each year. Prepare comparative statements of retained earnings for Lancaster Company for 2021 and 2020 , reflecting appropriate adjustments from items (1)-(4) above, ignoring income taxes
