Question: In an examination of Wirjanto Corporation as at December 31

In an examination of Wirjanto Corporation as at December 31, 2014, 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 1998. Depreciation was calculated using the straight-line method, based on an estimated life of 35 years. Early in 2014, 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, 2014.
2. An additional assessment of 2013 income taxes was levied and paid in 2014.
3. When calculating the accrual for officers' salaries at December 31, 2014, it was discovered that the accrual for officers' salaries for December 31, 2013, had been overstated.
4. On December 15, 2014, Wirjanto Corporation declared a common shares dividend of $1 per share on its issued common shares outstanding, payable February 1, 2015, to the common shareholders of record on December 31, 2014.
5. Wirjanto Corporation, which is on a calendar-year basis, changed its inventory cost flow formula as at January 1, 2014. The inventory for December 31, 2013, was casted by the weighted average method, and the inventory for December 31, 2014, was costed by the FIFO method.
6. On January 15, 2015, Wijanto's warehouse containing raw materials was damaged by a flash flood.
7. During December 2014, the former president retired and a new president was appointed.
Describe fully how each item above should be reported in the financial statements of Wirjanto Corporation for the year 2014.

View Solution:

Sale on SolutionInn
  • CreatedSeptember 18, 2015
  • Files Included
Post your question