Unusual items and financial statements. The accountant preparing the income statement for Bakersfield, Inc. had some doubts about the appropriate accounting treatment of the sixi 2020. Assume a tax rate of 20 percent. 1. Office equipment purchased January 1, 2020 for $60,000 was incorrectly charged to Supplies Expense at the time of purchase. The offic expected salvage value. Bakersfield uses the straight-line method to depreciate office equipment for financial reporting purposes. This error ha 2. The corporation disposed of its sporting goods division during 2020. This disposal meets the criteria for discontinued operations. The div $110,000 before taxes and a loss of $20,000 before taxes on the disposal of the division. All of these events occurred in 2020 and have not beer 3. The company recorded advances of $10,000 to employees made December 31, 2020 as Salaries and Wages Expense. 4. Dividends of $10,000 during 2020 were recorded as an operating expense. 5. in 2020. Bakersfield changed its method of accounting for inventory from the first-in-first-out method to the average cost method. Invento method. The new inventory method would have resulted in an additional $125,000 of cost of goods sold (before taxes) being reported on priory 6. On January 1, 2016, Bakersfeld bought a building that cost $85,000, had an estimated useful life of ten years, and had a salvage value of $5 straight-line depreciation method to depreciate the building. In 2020, it was estimated that the remaining useful life was eight years and the salva 2020 income statement was correctly calculated based on the newestimates. No adjustment for prior years' depreciation estimates was made Part A. For each item, record corrections to income from continuing operations before taxes, if any. Denote any negative numbers by using brack Unusual items and financial statements. The accountant preparing the income statement for Bakersfield, Inc. had some doubts about the appropriate accounting treatment of the sixi 2020. Assume a tax rate of 20 percent. 1. Office equipment purchased January 1, 2020 for $60,000 was incorrectly charged to Supplies Expense at the time of purchase. The offic expected salvage value. Bakersfield uses the straight-line method to depreciate office equipment for financial reporting purposes. This error ha 2. The corporation disposed of its sporting goods division during 2020. This disposal meets the criteria for discontinued operations. The div $110,000 before taxes and a loss of $20,000 before taxes on the disposal of the division. All of these events occurred in 2020 and have not beer 3. The company recorded advances of $10,000 to employees made December 31, 2020 as Salaries and Wages Expense. 4. Dividends of $10,000 during 2020 were recorded as an operating expense. 5. in 2020. Bakersfield changed its method of accounting for inventory from the first-in-first-out method to the average cost method. Invento method. The new inventory method would have resulted in an additional $125,000 of cost of goods sold (before taxes) being reported on priory 6. On January 1, 2016, Bakersfeld bought a building that cost $85,000, had an estimated useful life of ten years, and had a salvage value of $5 straight-line depreciation method to depreciate the building. In 2020, it was estimated that the remaining useful life was eight years and the salva 2020 income statement was correctly calculated based on the newestimates. No adjustment for prior years' depreciation estimates was made Part A. For each item, record corrections to income from continuing operations before taxes, if any. Denote any negative numbers by using brack
