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HELP PLEASE Presented below are the comparative income and retained earnings statements for Sage Inc. for the years 2020 and 2021. 2021 2020 $373,000 193,000
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Presented below are the comparative income and retained earnings statements for Sage Inc. for the years 2020 and 2021. 2021 2020 $373,000 193,000 Sales Cost of sales Gross profit Expenses Net income Retained earnings (Jan. 1) Net income 180,000 94,600 $85,400 $246,000 135,000 111,000 46,300 $64,700 $72.000 64,700 (25,000) $111,700 $111,700 Dividends 85,400 (32,800) $164,300 Retained earnings (Dec. 31) The following additional information is provided: 1. In 2021, Sage 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 2020 for $92,500 with an estimated useful life of 4 years and no salvage value. (The 2021 income statement contains depreciation expense of $27,750 on the assets purchased at the beginning of 2020.) In 2021, the company discovered that the ending inventory for 2020 was overstated by $23,400; ending inventory for 2021 is correctly stated. 2. Prepare the revised retained earnings statement for 2020 and 2021, assuming comparative statements. (Ignore income taxes.) SAGE INC. Retained Earnings Statement For the Year Ended 2021 2020 vi $ $
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