Conrad Playground Supply underwent a restructuring in $2024.$ The company conducted a thorough internal audit, during which the following facts were discovered. The audit occurred during $2024$ before any adjusting entries or closing entries are prepared.

a$.$ Additional computers were acquired at the beginning of $2022$ and added to the company's office network. The $$40,000$ cost of the computers was inadvertently recorded as maintenance expense. Computers have five$-$year useful lives and no material salvage value. This class of equipment is depreciated by the straight$-$line method.

b$.$ Two weeks prior to the audit, the company paid $$12,000$ for assembly tools and recorded the expenditure as office supplies. The error was discovered a week later.

c$.$ On December $31,2023,$ merchandise inventory was understated by $$68,000$ due to a mistake in the physical inventory count. The company uses the periodic inventory system.

d$.$ Two years earlier, the company recorded a $5\%$ stock dividend $(1,000$ common shares, $$1$ par$)$ as follows:

$\backslash$table$[[$Account Name,Debit,Credit$],[$Retained earnings,$1,000,],[$Common stock,,$1,000]]$

The shares had a market price at the time of $$11$ per share.

e$.$ At the end of $2023,$ the company failed to accrue $$84,000$ of interest expense that accrued during the last four months of $2023$ on bonds payable. The bonds, which were issued at face value, mature in $2028.$ The following entry was recorded on March $1,2024,$ when the semiannual interest was paid, as well as on September $1$ of each year:

$\backslash$table$[[$Account Name,Debit,Credit$],[$Interest expense,$126,000,],[$Cash$,,126,000]]$

f$.$ A three$-$year liability insurance policy was purchased at the beginning of $2023$ for $$69,000.$ The full premium was debited to insurance expense at the time.

Required:

For each error, prepare any journal entry necessary to correct the error, as well as any year$-$end adjusting entry for $2024$ related to the situation described. $($Ignore income taxes.$)$

Note: If no entry is required for a transaction$/$event$,$ select $"$No journal entry required" in the first account field.

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$\backslash$table$[[,$No$,$Transaction,General Journal,Debit,Credit$],[0,1,a(1),,40,000,],[0,2,a(2),$Depreciation expense,$8,000,],[,,,$Accumulated depreciation,,$8,000],[0,3,b(1),,12,000,],[,,,$Office supplies,,$12,000],[>,4,b(2),$No Transaction Recorded,,$],[,5,c(1),,68,000,],[,,,,,68,000],[>,6,c(2),$No journal entry required,,$],[0,7,d(1),$No Transaction Recorded,,$],[0,8,d(2),$No journal entry required,,$],[>,9,e(1),,84,000,],[,,,$Interest expense,,$84,000],[0,10,e(2),$Interest expense,,$],[,,,$Interest payable,,$]]$

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View journal entry worksheet

Conrad Playground Supply underwent a restructuring in $2024.$ The company conducted a thorough internal audit, during which the

following facts were discovered. The audit occurred during $2024$ before any adjusting entries or closing entries are prepared.

a$.$ Additional computers were acquired at the beginning of $2022$ and added to the company's office network. The $$40,000$ cost of

the computers was inadvertently recorded as maintenance expense. Computers have five$-$year useful lives and no material

salvage value. This class of equipment is depreciated by the straight$-$line method.

b$.$ Two weeks prior to the audit, the company paid $$12,000$ for assembly tools and recorded the expenditure as office supplies. The

error was discovered a week later.

c$.$ On December $31,2023,$ merchandise inventory was understated by $$68,000$ due to a mistake in the physical inventory count.

The company uses the periodic inventory system.

d$.$ Two years earlier, the company recorded a $5\%$ stock dividend $(1,000$ common shares, $$1$ par$)$ as follows:

The shares had a market price at the time of $$11$ per share.

e$.$ At the end of $2023,$ the company failed to accrue $$84,000$ of interest expense that accrued during the last four months of $2023$

on bonds payable. The bonds, which were issued at face value, mature in $2028.$ The following entry was recorded on March $1,$

$2024,$ when the semiannual interest was paid, as well as on September $1$ of each year:

f$.$ A three$-$year liability insu