Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Navajo Company's financial statements show the following. The company recently discovered that in making physical counts of inventory, it had made the following errors: Year
Navajo Company's financial statements show the following. The company recently discovered that in making physical counts of inventory, it had made the following errors: Year 1 ending inventory is understated by $62,000, and Year 2 ending Inventory is overstated by $32,000. For Year Ended December 31 Year 1 Year 2 Year 3 (a) Cost of $ 737,000 $ 967,000 $ 802,000 goods sold (b)Net income 280,000 287,000 262,000 Total (c)current 1,259,000 1,372,000 1,242,000 assets (d) Total 1,399,000 1,592,000 equity 1,257,000 Required: 1. For each key financial statement figurea). (2). (C), and (belowprepare a table to show the adjustments 2. What is the total error in combined net income for the three-year period resulting from the inventory errors? Complete this question by entering your answers in the tabs below. Required Required 1 2 For each key financial statement figure-(a), (b), (c), and (d) below-prepare a table to show the adjustments necessary to correct the reported amounts. (Amounts to be deducted must be entered with a minus sign.) Year 1 Year 2 Year 3 Cost of goods sold: Reported amount Adjustments 12/31/Year 1 error for: 12/31/Year 2 error Corrected S 0 $ 0 $ 0 amount Net income: Reported amount Adjustments 12/31/Year 1 error for: 12/31/Year 2 error Corrected S 0 $ 0 $ 0 amount Total current assets
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started