Compute corrected net income given inventory errors (L.O. 1)

Kelley Company reported net income of $358,050 for 2011, $371,400 for 2012, and $325,800 for 2013, using the incorrect inventory amounts shown for December 31, 2011, and 2012. Recently, Kelley corrected the inventory amounts for those dates. Kelley used the correct December 31, 2013, inventory amount in calculating 2013 net income.

December 31, 2011 Incorrect: 72,600. Correct: 85,200

December 31, 2012 Incorrect: 84,000 Correct: 70,200

Make a schedule that shows:(a)the reported net income for each year,(b)the amount of correction needed for each year, and(c)the correct net income for each year.