Lee Corporation

Lee Corporation began operations in January of 2004. In 2007 an error was discovered in the 2005 financial statements that had depreciation expense certify by $25,000 before a task tar earn of 40%. Lee Corporation also made a vicissitude in the method used to value memorial. The reposition resulted in a cumulative decrease in income of $35,000 with a tax revenue rate of 40%. Lee Corporation also enjoin dividends of $100,000 to be paid in early 2008. Income before taxes for 2007 was $240,000 with an in effect(p) tax rate of 40%, making net income for 2007 $144,000. The necessitate journal entries are needed to record these transactions and describe other comprehensive income. retained requital15,000 Deferred Taxes10,000 Accumulated disparagement25,000 To record the shift in depreciation, net of the tax rate. Retained Earnings21,000 Deferred Taxes14,000 Inventory35,000 To record the change in inventory valuation method, net of the tax rat e for 2007. Retained Earnings100,000 Dividends payable100,000 To record cash dividends declared in 2007, to be paid Jan 15, 2008. Lee acquired a Canadian subsidiary for CA $100,000 which is the value of the sole asset of land that the subsidiary owned. The substitute rates obtained from www.x-rates.com for the years 2004 2007 are stated below. Amount in Amount in YearCanadian $U.S. $Factor 2004100,00083,065.50.830655 2005100,00086,136.40.861364 2006100,00085,888.50.858885 2007100,000101239.501.012395 Journal entries for the foreign discourse limitings for years 2005 2007 are as follows. Investment in appurtenant3070.90 additive variation Adjustment3070.90 To record exchange adjustment for 2005 (86,136.40 83,065.50) Cumulative translation Adjustment247.90 Investment in secondary 247.90 To record exchange adjustment for 2006 (85,888.50 - 86,136.40) Investment in appurtenant15351.00 Cumulative translation Adjustment15351.00 To record...I f you want to get a full essay, order it on ! our website: OrderCustomPaper.com

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