Inventory Errors

Haywood Inc. reported the following information for 2018:

Brief Exercise 6-35 (Algorithmic) Inventory Errors Haywood Inc. reported the following information for 2018: $25,000 Beginning inventory Ending inventory 58,240 1,000,000 Sales revenue Cost of goods sold 620,000 A physical count of inventory at the end of the year showed that ending inventory was actually $65,000. Required: 1. What is the correct cost of goods sold and gross profit for 2018? Cost of goods sold $608,440 x Gross profit 2. Assuming the error was not corrected, what is the effect on the statement of financial position at December 31, 2018? At December 31, 2019? Net Income December 31, 2018 December 31, 2019