FULL SCREEN PRINTER VERSION 4 BACK NE Exercise 22-7 Presented below are the comparative Income statements for Pannebecker Inc. for the years 2014 and 2015 Sales Cost of sales Gross profit Expenses Net Income Retained earnings (Jan. 1) Net Income Dividends Retained earnings (Dec. 31) 2015 $340,000 200,000 140,000 88,000 $52,000 $125,000 52,000 (30,000) $147,000 2014 $270,000 142,000 128,000 50,000 $78,000 $72,000 78,000 (25,000) $125,000 1. 2. The following additional information is provided. In 2015, Pannebecker Inc. decided to switch its depreciation method from sum-of-the-years-digits to the straight-line method. The assets were purchased at the beginning of 2014 for $90,000 with an estimated useful life of 4 years and no residual value. (The 2015 income statement contains depreciation expense of $27,000 on the assets purchased at the beginning of 2014.) In 2015, the company discovered that the ending inventory for 2014 was overstated by $20,000; ending inventoly for 2015 is correctly stated. Prepare the revised retained earnings statement for 2014 and 2015, assuming comparative statements. (Ignore Income taxes.) (List items that increase retained earnings first. Do not leave any answer field blank. Enter o for amounts.) PANNEBECKER INC. Retained Earnings Statement For the Year Ended 2015 2014 tice Assignment Gradebook Downloadable eTextbook ent FULL SCREEN PRINTER VERSION BACK NEXT Net Income Dividends Retained earnings (Dec. 31) 52,000 (30,000) $147,000 78,000 (25,000) $125,000 The following additional Information is provided. 1. In 2015, Pannebecker Inc. decided to switch its depreciation method from sum-of-the-years-digits to the straight-line method. The assets were purchased at the beginning of 2014 for $90,000 with an estimated useful life of 4 years and no residual value. (The 2015 income statement contains depreciation expense of $27,000 on the assets purchased at the beginning of 2014.) 2. In 2015, the company discovered that the ending inventory for 2014 was overstated by $20,000; ending inventory for 2015 is correctly stated Prepare the revised retained earnings statement for 2014 and 2015, assuming comparative statements. (ignore Income taxes.) (List Items that increase retained earnings first. Do not leave any answe. Veld blank. Enter o for amounts.) PANNEBECKER INC. Retained Earnings Statement For the Year Ended 2015 2014