On January 2, 2018, Moose Corp. purchased machinery for $270,000. The entire cost was incorrectly recorded as an expense. The machinery has a nine-year life and a $18,000 residual value. Beaver uses straight-line depreciation for all its plant assets. The error was not discovered until May 1, 2020, and the appropriate corrections were made. Ignore income tax considerations. Moose's income statement for the year ended December 31, 2020 would show the cumulative effect of this error in the amount of: $214,000. $242,000. O $0. O $186,000. On January 2, 2018, Moose Corp. purchased machinery for $270,000. The entire cost was incorrectly recorded as an expense. The machinery has a nine-year life and a $18,000 residual value. Beaver uses straight-line depreciation for all its plant assets. The error was not discovered until May 1, 2020, and the appropriate corrections were made. Ignore income tax considerations. Before the corrections were made, retained earnings was understated by O $186,000. O $242,000. $ 270,000. $ 214,000. On January 1, 2017, Wren Corp. purchased a patent for $238,000. The patent is being amortized straight-line with no residual value over its remaining legal life of 15 years. At the beginning of 2020, however, Wren determined that the economic benefits of the patent would not last longer than ten years from the date of acquisition. What amount should be reported in the 2020 of financial position for the patent, net of accumulated amortization, at December 31, 2020? $168,000 $ 174,550 $ 163,200 O $142,800 Which of the following is NOT considered to be an accounting error? X expensing the cost of a new machine changing depreciation methods from declining balance to straight line O changing from the cash basis to the accrual basis O failing to accrue wages payable at year end Which of the following should be given retrospective treatment? Change in Estimated Lives of Depreciable Assets Change from Unacceptable Policy to Acceptable Policy no yes yes no no no O yes yes