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Question - You have been engaged to review the financial statements of In at the end of its first year of operations. IN the course of your examination, you conclude that the bookkeeper hired is not doing a good job. You notice a number of irreglarities as follows:
1) Year end wages payable of $3,720 were not recorded because the bookkeeper though that they were immaterial
2) Accrued vacation pay for the year of $31,100 was not recorded because the bookkeeper never heard that you had to do it.
3) Insurance for a 12 month period purchased on November 1 of this year was charged to insurance expense in the amount of $2,448 because the amount of the check is about the same every year.
Prepare the necessary correcting entries, assuming that in uses a calendar year basis. The books for the current year have not yet been closed.
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