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2) On December 31, 20x1, the Veranda Company reported the following: Current Assets Current Liabilities Net Income $ 100,000 50,000 200,000 Year-end inventory was determined

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2) On December 31, 20x1, the Veranda Company reported the following: Current Assets Current Liabilities Net Income $ 100,000 50,000 200,000 Year-end inventory was determined by a physical count at December 31,20x1 Company policies: The FIFO Inventory method is used; the periodic inventory method is used. For the purchase of inventory Shipping costs are treated as: Period costs The following transactions occurred at the end of the current fiscal year or at the beginning of the next fiscal year. Assume all transactions (for purchases and sales) are on account (not cash.) a] A transaction for the purchase of merchandise inventory Terms: Shipping Date: Arrival Date: Cost of inventory Shipping costs: Transaction recorded: net 30; FOB Shipping Point December 28, 20x1 January 3, 20x2 $ 5,000 $ 350 January 3, 20x2 b] A transaction for the sale of merchandise inventory net 30; December 29, 20x1 January 4, 20x2 $ 3,000 FOB Destination Terms: Shipping Date: Arrival Date: Cost of inventory: Sale price: Transaction recorded: 5,500 December 29,20x1 c] Merchandise was sent, on consignment, to a sales representative: Shipping Date: Arrival Date: Cost of inventory: December 23, 20x1 December 26, 20x1 $2,200 2) (continued) d] A transaction for the purchase of merchandise inventory Terms: Shipping Date: Arrival Date: Cost of inventory: Shipping costs Transaction recorded: 2/10, net 30; FOB Destination December 30, 20x1 January 5, 20x2 $2,700 225 January 5, 20x2 e A transaction for the sale of merchandise inventory: Terms: Shipping Date Arrival Date: Cost of inventory: Sale price: Transaction recorded: 2/10, net 30; FOB Shipping Point December 30, 20x1 anuary 6, 20x2 $ 4,200 6,100 December 30, 20x1 REQUIRED Determine the following: 1) The working capital ratio before the errors were discovered 2) The corrected amount of current assets at December 31, 20x1. 3) The corrected amount of current liabilities at December 31, 20x1 4) The working capital ratio ofter the errors were discovered. 5) The corrected amount of net income for the year ended December 31, 20x1

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