Streuling Inc. is preparing its 2002 year-end financial statements. Prior to any adjustments, inventory is valued at \($76,050.\) The following information has been found relating to certain inventory transactions.

(a) Goods valued at \($11,000\) are on consignment with a customer. These goods are not included in the \($76,050\) inventory figure.

(b) Goods costing \($2,700\) were received from a vendor on January 5, 2003. The related invoice was received and recorded on January 12, 2003. The goods were shipped on December 31, 2002, terms FOB shipping point.

(c) Goods costing \($8,500\) were shipped on December 31, 2002, and were delivered to the customer on January 2, 2003. The terms of the invoice were FOB shipping point. The goods were included in ending inventory for 2002 even though the sale was recorded in 2002.

(d) A \($3,500\) shipment of goods to a customer on December 31, terms FOB destination, was not included in the year-end inventory. The goods cost \($2,600\) and were delivered to the customer on January 8, 2003. The sale was properly recorded in 2003.

(e) An invoice for goods costing \($3,500\) was received and recorded as a purchase on December 31, 2002. The related goods, shipped FOB destination, were received on January 2, 2003, and thus were not included in the physical inventory.

(f) Goods valued at \($6,500\) are on consignment from a vendor. These goods are not included in the year-end inventory figure.

(g) A \($10,500\) shipment of goods to a customer on December 30, 2002, terms FOB destination, was recorded as a sale in 2002. The goods, costing \($8,200\) and delivered to the customer on January 6, 2003, were not included in 2002 ending inventory.

Instructions:
1 . Determine the appropriate accounting treatment for each of the above items.
Justify' your answers.
2. Compute the proper inventory amount to be reported on Streuling Inc.'s balance sheet for the year ended December 31, 2002.
3. By how much would net income have been misstated if no adjustments were made for the above transactions? Ignore income taxes.