P5.6 In an examination of Garganta Limited as at December 31, 2020, you have learned about the following situations. No entries have been made in the accounting records for these items.

1. The corporation erected its present factory building in 2004. Depreciation was calculated using the straight-line method, based on an estimated life of 35 years. Early in 2020, the board of directors conducted a careful survey and estimated that the factory building had a remaining useful life of 25 years as at January 1, 2020. 2. An additional assessment of 2019 corporate income tax was levied and paid in 2020. 3. When calculating the accrual for officers' salaries at December 31, 2020, it was discovered that the accrual for officers' salaries for December 31, 2019, had been overstated. 4. On December 15, 2020, Garganta Limited declared a common shares dividend of $1 per share on its issued common shares outstanding, payable February 1, 2021, to the common shareholders of record on December 31, 2020. 5. Garganta Limited, which is on a calendar-year basis, changed its inventory cost formula as at January 1, 2020. The inventory for December 31, 2019, was costed by the weighted average method, and the inventory for December 31, 2020, was costed by the FIFO method. 6. On January 15, 2021, Garganta's warehouse containing raw materials was damaged by a flash flood. 7. During December 2020, the former president retired and a new president was appointed. 8. Garganta suffered a loss from a former employee stealing cash from a deposit of cash sales in the first quarter of the year. The amount has been a reconciling item on the bank reconciliation ever since the theft. Garganta has not yet made any journal entry. Instructions Describe fully how each item above should be reported in the financial statements of Garganta Limited for the year 2020.