Antique Carpets’ books show the following data (in thousands). In early 2013 auditors found that the ending inventory for 2010 was understated by \($8\) thousand and that the ending inventory for 2012 was overstated by \($9\) thousand. The ending inventory at December 31, 2011, was correct.

Requirements
1. Prepare corrected income statements for the three years.
2. State whether each year’s net income—before your corrections—is understated or overstated and indicate the amount of the understatement or overstatement.

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(Thousands) Net sales revenue Cost of goods sold: ... Beginning inventory Net purchases Cost of goods available... Ending inventory Cost of goods sold Gross profit.... Operating expenses Net income.. 2012 2011 2010 $ 206 $ 160 $ 175 $ 19 $ 23 $ 43 138 95 81 157 118 124 (30) (19) (23) 127 99 101 79 61 74 52 37 34 $ 27 $ 24 $ 40