Note: The books have been closed.

Wolochuck Company is in the process of having its financial statements audited for the first time as of 12/31/14. The Company is in its 5th year of operations and has always relied on itsbookkeeper to prepare annual financial statements. The auditor has found the following incorrect oroverlooked items that occurred over the past 5 years.

a. Wolochuck purchased a machine on June 30, 2011 at a cost of $45,000. The machinehas a salvage value of $3,000 and a useful life of 6 years. The bookkeeper recordedstraight-line depreciation during each year, but failed to consider the salvage value.

b. During 2014, Wolochuck changed from the straight-line method of depreciation for itsbuilding to the double-declining method. The auditor provided the followingcomputations which present depreciation on both bases: 2014 2013 2012 Straight-line $36,000 $36,000 $36,000 Declining-balance $47,360 $59,200 $74,000

c. The physical inventory count on December 31, 2013, improperly excluded merchandisecosting $20,000 that had been temporarily stored in a public warehouse. Wolochuckuses a periodic inventory system.

d. A $18,000 insurance premium paid on October 1, 2013, for a policy that expires onSeptember 30, 2016. The premium was charged to insurance expense when paid.

e. Accrued wages of $3,500 were not recorded on December 31, 2012.

f. The auditor discovered that a sale of land on February 20, 2012 resulted in a gain of$5,000. The land was purchased in 2006 for $27,000. When the bookkeeper recordedthe sale in 2012 the gain was credited to common stock.

g. An advance payment for rent was received on January 1, 2013. The payment was for$36,000 and covers 4 years of rent for a warehouse owned by Wolochuck. When thecash payment was received the bookkeeper recorded the following entry: Cash 36,000 Rent Payable 36,000 The Rent Payable account has not been altered since its original recording.

Instructions: Prepare the journal entries necessary at 12/31/14 to correct the books for the items found by the auditor. The books have been closed for 2014. Ignore income tax considerations.