During 2021. WMC Corporation discovered that its ending Inventorles reported in its financial statements were misstated by the following material amounts: 2019 2020 understated by overstated by $135, eee 165, eee WMC uses a periodic Inventory system and the FIFO cost method. Required: 1. Determine the effect of these errors on retained earnings at January 1, 2021, before any adjustments. (Ignore Income taxes.) 2. Prepare a Journal entry to correct the errors. Complete this question by entering your answers the tabs below. Required 1 Required 2 Determine the effect of these errors on retained earnings at January 1, 2021, before any adjustments. (Ignore income taxes.) Retained earnings would be (Required: Required 2 > During 2021, WMC Corporation discovered that its ending Inventories reported in its financial statements were misstated by the following material amounts: 2019 2020 understated by overstated by $135,000 265,00 WMC uses a periodic Inventory system and the FIFO cost method. Required: 1. Determine the effect of these errors on retained earnings at January 1, 2021, before any adjustments. (Ignore income taxes.) 2. Prepare a journal entry to correct the errors. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare a journal entry to correct the errors. (If no entry is required for a transaction/event, select "No journal entry required" in first account field.) View transaction list Journal entry worksheet > Record the entry to correct the errors Note: Enter debits before credits. Event General Journal Debit Credit 1 Record entry Clear entry View general journal