Problem #1 Error Correction

In early 2019, after the 2018 books had been closed, an auditor found several errors relating to the previous 3 years. The net income as reported is listed below. The following errors were discovered.

1. The 2016 ending inventory was understated by $4,600.
2. The 2016 accrual for wages of $8,100 was not made.
3. Equipment was purchased on Jan 2, 2016. The cost is $60,000, with an estimated salvage value of $10,000. The useful life is 5 years. The company uses straight-line depreciation. The accountant in charge forgot to subtract the salvage value when calculating the depreciation for all of the years in question.
4. On Jan 3, 2017, a 3-yr insurance policy was purchased for $24,000. It was all expensed at that time.

Please prepare the corrections to the net income to get the values as restated. Then prepare any correcting journal entries that need to be made in 2019.

2016 2017 2018

Net Income (as reported) $175,000 $216,000 $242,000