Mike's Custom Furniture, Inc., reported the following comparative income statements for the years ended April 30, 2016 and 2015.

During 2016, Mike’s Custom Furniture, Inc., discovered that the 2015 ending inventory, as previously reported, was overstated by $1,900.

Requirements
1. Prepare the corrected comparative income statements for the two-year period, complete with a heading for the statements.
2. What was the effect of the error on net income for the two years combined? Explain your answer.

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Mike's Custom Furniture, Ino. Comparative Income Statements For the Years Ended April 30, 2016 and 2015 2016 $194,000 2016 $163,000 Sales Revenue Cost of Goods Sold: $ 9,100 89.700 98,800 $13,600 106,300 Cost of Goods Available for Sale 119,900 18,500 Beginning Inventory Net Purchases Ending Inventory Cost of Goods Sold 13,600 101,400 92,600 85,200 77,800 19,200 $ 58.600 Gross Profit Operating Expenses Net Income 25,700 $ 6,900