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In 2022, Draper Company discovered errors made in 2019-2021, its first three years of operation. 2021 2020 2019 Items not recognized: Prepaid expenses $1,300 $900

In 2022, Draper Company discovered errors made in 2019-2021, its first three years of operation.

2021

2020

2019

Items not recognized:

Prepaid expenses

$1,300

$900

$550

Accrued expenses

950

700

800

Other information:

Reported net income

$23,000

$25,000

$20,000

Dividends declared and paid

4,100

2,600

5,000

Common stock and additional paid in capital at 12/31

22,000

17,000

15,000

Restated 2022 Net Income will be:

Select one:

a. $350 overstated

b. $350 understated

c. $150 understated

d. $150 overstated

e. No Error

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