Molina Companys reported net incomes for 2013 and the previous two years are presented below. 2013 2012 2011 $105,000 $95,000 $70,000 2013s net income was properly determined after giving effect to the following accounting changes, error corrections, etc. which took place during the year. The incomes for 2011 and 2012 do not take these items into account and are stated at the amounts determined in those years. Ignore income taxes. Instructions (a) For each of the six accounting changes, errors, or prior period adjustment situations described below, prepare the journal entry or entries Molina Company should record during 2013. If no entry is required, write none. (b) After recording the situation in part (a) above, prepare the year-end adjusting entry for December 31, 2013. If no entry, write none. 1. Early in 2013, Molina determined that equipment purchased in January, 2011 at a cost of $645,000, with an estimated life of 5 years and salvage value of $45,000 is now estimated to continue in use until December 31, 2017 and will have a $15,000 salvage value. Molina recorded its 2013 depreciation at the end of 2013. (a) (b) 3. Molina bought a truck January 1, 2010 for $50,000 with a $5,000 estimated salvage value and a six-year life. The company debited an expense account and credited cash on the purchase date. The truck is expected to be traded at the end of 2015. Molina uses straight-line depreciation for its trucks. (a) (b) 5. Molina, in reviewing its provision for uncollectibles during 2013, has determined that 1/2 of 1% is the appropriate amount of bad debt expense to be charged to operations. The company had used 1% as its rate in 2012 and 2011 when the expense had been $20,000 and $14,000, respectively. The company would have recorded $50,000 of bad debt expense on December 31, 2013 under the old rate. (a) (b) 6. During 2013, Molina decided to change from the LIFO method of valuing inventories to average cost. The net incomes involved under each method were as follows: 2013 2012 2011 LIFO $51,000 $59,000 $42,000 Average cost $63,000 $67,000 $48,000 Assume no difference between LIFO and average cost inventory values in years prior to 2011. (a) (b)