Reference no: EM133011327

Problem 1: A subsequent event for an entity with a December 31, 2021, year-end would not include:

a. a change in the estimated useful lives of equipment in January 2022.

b. an issuance of bonds in January 2022.

c. an acquisition of another company in January 2022.

d. a major uncertainty at December 31, resolved in January 2022.

Problem 2: An example of an error would be

a. purchasing inventory from a related party.

b. counting an inventory item twice when taking a physical inventory.

c. holding back invoices so that accounts payable are understated.

d. receiving kickbacks in exchange for issuing a purchase order to a vendor.