The attached items were discovered during the audit of the financial statements of Carey Corporation for the year ending December 31, 20X6. REQUIRED: (1) (2) Using the attached form, prepare an Unadjusted Schedule of Possible Misstatements, showing the total dollar effect of each of the errors attached and the dollar effect on the appropriate financial statement categories indicated. Assume that balance sheet and income statement materiality for the audit of Carney's financial statements is $75,000. What should the auditor's conclusion about the financial statements be if the audit findings are not corrected by Carney's management before the audit report is issued? G CARNEY CORPORATION ITEMS DISCOVERED DURING AUDIT OF FINANCIAL STATEMENTS FOR YEAR ENDING DECEMBER 31, 20X6 (a) The company's financial statements did not include an accrual for bonuses earned by senior management in 20x6 but payable in March 20x7. The total bonus amount was $125,000. () Equipment originally costing $725,000 that was fully depreciated with a remaining residual value of $60,000 was sold for $85,000 on December 29, 20X6. The purchaser agreed to pay for the equipment by January 15, 20x7. (c) Based on close examination of the client's aged accounts receivable trial balance and correspondence files with customers, the auditor determined that management's allowance for bad debts is overstated by $44,000. (d) Expenses totaling $52,000 associated with the maintenance of equipment were inappropriately debited to the equipment account. (e) Marketing expenses of $43,000 were incorrectly sified as cost of goods sold. ( The company received new computer equipment on January 3, 20X7, with a cost of $25,000, that had been ordered and shipped f.o.b. shipping point to Camey on December 27, 20X6. No entry has been recorded for this purchase, which was financed by a long term note payable due in full on June 30, 20X8. (1) CARNEY CORPORATION SCHEDULE OF POSSIBLE MISSTATEMENTS-OVERSTATEMENT OR (UNDERSTATEMENT) FOR YEAR ENDING DECEMBER 31, 20X6 Noncurrent Current Noncurrent Income Total Amount Current Assets Assets Liabilities Liabilities Before Tax Item (a) (b) (c) (d) (e)