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Just after the September 30 year-end, Singer Supplies discovered they forgot to count $68,745 worth of inventory that was in transit (FOB Shipping Point).

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Just after the September 30 year-end, Singer Supplies discovered they forgot to count $68,745 worth of inventory that was in transit (FOB Shipping Point). This amount is material in nature, and had been recorded as an expense to Cost of Goods Sold by mistake. The president, however, fears tax implications if they correct the error. Should they fix the mistake? Make sure you explain two ramifications in your answer. (4 marks)

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