Capwell Corporation uses a periodic inventory system. The company's ending inventory on December 31, 2018, its fiscal-year end, based on a physical count, was determined to be $328,000. Capwell's unadjusted trial balance also showed the following account balances: Purchases, $640,000; Accounts payable; $220,000; Accounts receivable, $235,000; Sales revenue, $820,000. The internal audit department discovered the following items: 1. Goods valued at $34,000 held on consignment from Dix Company were included in the physical count but not 2. Purchases from Xavier Corporation were incorrectly recorded at $32,000 instead of the correct amount of $23,000. 3. Goods that cost $27,000 were shipped from a vendor on December 28, 2018, terms to.b. destination. The 4. One inventory item was incorrectly included in ending inventory as 120 units, instead of the correct amount of 1,100 5. The 2017 balance sheet reported inventory of $372,000. The internal auditors discovered that a mathematical error recorded as a purchase The correct amount was included in the ending inventory. merchandise arrived on January 3, 2019. The purchase and related accounts payable were recorded in 2018. units. This item cost $40 per unit caused this inventory to be understated by $64,000. This amount is considered to be material. Comparative financial statements will be issued. 6. Goods shipped to a customer f.o.b. destination on December 25, 2018, were received by the customer on January 4, 2019. The sales price was $42,000 and the merchandise cost $23,000. The sale and corresponding accounts receivable were recorded in 2018 7 Goods shipped from a vendor fo.b. shipping point on December 27, 2018, were received on January 3, 2019. The merchandise cost $20,000. The purchase was not recorded until 2019. Required: 1. Determine the correct amounts for 2018 ending inventory, purchases, accounts payable, accounts receivable, and sales revenue. 2. Calculate cost of goods sold for 2018. 3. What was the effect of the error in ending inventory on 2017 before-tax income? Complete this question by entering your answers in the tabs below Req 1 and 2 Req 3 Determine the correct amounts for 2018 ending inventory, purchases, accounts payable, accounts receivable, sales revenue, and cost of goods sold. Endi Accounts Accounts Sales revenue able Cost of goods sold Req 1 and 2 Req 3 > Req 1 and 2 Req3 What was the effect of the error in ending inventory on 2017 before-tax income? 2017 before-tax by income was