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On January 1, 2017, a piece of equipment was purchased for $3,305.2 and was recorded as an expense by mistake. The company typically uses a
On January 1, 2017, a piece of equipment was purchased for $3,305.2 and was recorded as an expense by mistake. The company typically uses a zero residual value and an estimated useful life of 10 years for assets of this type. The company uses the straight-line method to depreciate all of its assets. The bug was discovered and fixed in early 2020 (before adjustments). Ignoring any tax effect, the entry to correct the error will include a a. CR to Accumulated Depreciation for $992. b. DR to Retained Earnings of $2,314. c. DR depreciation expense of $992. d. CR to Retained Earnings of $4,297.
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