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Plus Co. purchased machinery that cost $1,800,000 on January 4, 2020. The entire cost was recorded as an expense. The machinery has a nine-year life
Plus Co. purchased machinery that cost $1,800,000 on January 4, 2020. The entire cost was recorded as an expense. The machinery has a nine-year life and a $120,000 residual value. The error was discovered on December 20, 2022. Ignore income tax considerations.
How much of the effect of this error will be shown on Plus's income statement for the year ended December 31, 2022?
1. $1,240,000.
2. $1,426,667
3. $186,667
4. $1,613,333
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