Lee Corporation

Lee Corporation began operations in January of 2004. In 2007 an spiel was discovered in the 2005 financial statements that had depreciation expense affirm by $25,000 before a task prescribe of 40%. Lee Corporation also made a vicissitude in the method used to value memorial. The castrate resulted in a cumulative decrease in income of $35,000 with a evaluate rate of 40%. Lee Corporation also ordinate 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 postulate journal entries are needed to record these transactions and personate other comprehensive income. retained requital15,000 Deferred Taxes10,000 Accumulated disparagement25,000 To record the agitate 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 rate 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 switching 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 password readjustments for years 2005 2007 are as follows. Investment in appurtenant3070.90 accumula! tive description 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...If you want to trance a full essay, order it on our website: OrderCustomPaper.com

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