Jacobsen Corporation is negotiating a loan for expansion purposes. Jacobsen's books and records have never been audited and the bank has requested that an audit be performed and that IFRS be followed. Jacobsen has prepared the following comparative financial statements for the years ended December 31, 2020 and 2019. JACOBSEN CORPORATION Statement of Financial Position as at December 31, 2020 and 2019 2020 2019 Assets Current assets Cash $163.000 $82.000 Accounts receivable 392.000 296.000 Allowance for doubtful accounts (37,000 (18,000 Fair value net income investments 78.000 78.000 ventory 207.000 202000 Tots Current 355 303.000 640.000 Plantassets Property and timent 167.000 169.500 421600 106.400 Property, plant, and equipment 167,000 169.500 Accumulated depreciation (121,600 (106,400) Plant assets (net) 45,400 63,100 Total assets $848,400 $703,100 Liabilities and Shareholders' Equity Liabilities Accounts payable $121,400 $196,100 Shareholders' equity Common shares, no par value. 50.000 authorized 20,000 issued and outstanding 260,000 260,000 Retained earnings 467.000 247.000 Total shareholders equity 727.000 507,000 Total liabilities and shareholders equity SB48.400 $703,100 JACOBSEN CORPORATION Statement of Income for the Years Ended December 31, 2020 and 2019 2020 2019 Sales $1,000,000 $900,000 Cost of sales 430,000 395,000 Gross profit 570,000 505,000 Operating expenses 210,000 205,000 Administrative expenses 140,000 105,000 350,000 310,000 Net income $ 220,000 $195,000 During the audit, the following additional facts were determined: 1 An analysis of collections and losses on accounts receivable during the past two years indicates a drop in anticipated bad debt losses, Management has decided that the loss experience rate on sales should be reduced from the recorded 295 to 15%, beginning with the year ended December 31, 2020: 2 An analysis of the fair value-net income investments revealed that the totalfair value for these investments as at the end of each year was as follows: $78,000 Dec 31, 2019 Dec 31, 2020 $64.900 3 Inventory at December 31, 2019 was overstated by 59.000 and inventory at December 31, 2020, was overstated by 515.600 On January 2, 2019. ulment contine 830.500 estimated useful life of 10 years and residual value of $7.100) was incorrectly charged to operating expenses. Jacobsen records depreciation on the straight line basis. In 2020, fully deprecated equiment with no residual value that originally cost $18.600 was sold as scrap for $3.700. Jacobsen credited the $3.700 in proceeds to the equipment account Analysis of 2019 operating expenses revealed that Jacobsen charged to expenses four year insurance premium of 55.900 on January 1, 2019 The arealed that operating perses were incorrectiv dhe part of administrative perses in the amount 515.000 in 2019 and 535.000 in 2020 5 5 Beginning with reported net income, prepare a schedule showing the calculation of corrected net income for the years ended December 31, 2020 and 2019, assuming that any adjustments are to be reported on comparative statements for the two years. Ignore income tax effects (Do not prepare financial statements) (Enter negative amounts using either a negative sign preceding the number es 45 or parentheses es. (45). Do not leave any answer field blank. Enter for amounts) JACOBSEN CORPORATION Computation of Corrected Net Income For the Years Ended December 31, 2020 and 2019 2020 2019 Reported income $ 220000 195000 Chance in accounts receivable loss experience rate from 29 to 156 10000 0 Loss on trading securities - 10000 3000 Ending mentories overstatud De 31 2019 2000 1000 December 31, 2020 5100 Misposting of equipment purchase Decrease in operating expenses-2019 O 30500 Increase in operating expenses-2020 - 1100 1100 Misposting of proceeds of equipment sold 2500 0 Recognition of prepaid insurance 0 -1800 Operating expenses classification 900 0 Corrected net income 213400 205300