48) Accrued salaries payable of $ 51,000 were NOT recorded at December 31, 2007. Office supplies on hand of $ 24,000 at December 31, 2008 were erroneously treated as expense instead of supplies inventory. Neither of these errors was discovered nor corrected. The effect of these two errors would cause
A. 2007 net income to be overstated $ 27,000 and 2008 net income to be understated $ 24,000.
B. 2008 net income to be understated $ 75,000 and December 31, 2008 retained earnings to be understated $ 24,000.
C. 2007 net income and December 31, 2007 retained earnings to be understated $ 51,000 each.
D. 2008 net income and December 31, 2008 retained earnings to be understated $ 24,000 each.
49) The estimated life of a building that has been depreciated 30 years of an originally estimated life of 50 years has been revised to a remaining life of 10 years. Based on this information, the accountant should
A. adjust accumulated depreciation to its appropriate balance, through net income, based on a 40-year life, and then depreciate the adjusted book value as though the estimated life had always been 40 years.
B. continue to depreciate the building over the original 50-year life.
C. depreciate the remaining book value over the remaining life of the asset.
D. adjust accumulated depreciation to its appropriate balance through retained earnings, based on a 40-year life, and then depreciate the adjusted book value as though the estimated life had always been 40 years.