Answered step by step
Verified Expert Solution
Link Copied!

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

image text in transcribed
image text in transcribed
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 $59,000, and Year 2 ending inventory is overstated by $29,000. $ $ $ For Year Ended December 31 (a) Cost of goods sold (b) Net income (c) Total current assets (d) Total equity Year 1 734,800 277,eee 1,256,eee 1,396, Bee Year 2 964, see 284,80 1,369, eee 1,589,eee Year 3 299,000 259.ee 1,239,000 1,254,000 Required: 1. For each key financial statement figure-al (6).(c) and (d) below-prepare a table to show the adjustments necessary to correct the reported amounts 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 1 Required 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.) Yeart Year 2 Year 3 Cost of goods sold: Reported amount Adjustments for 12/31/Year 1 error 12/31/Year 2 error Corrected amount Net income Reported amount Adjustments for 12/31 Year 1 error 12/31/Year 2 error Corrected amount s ols Reported amount Adjustments for 12/31/Year 1 error 12/31/Year 2 error Corrected amount S 0 Reported amount Adjustments for 12/31/Year 1 error 12/31/ Vear 2 error Corrected amount 50 50 50 Required 2 > 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 $59,000, and Year 2 ending inventory is overstated by $29.000 For Year Ended December 31 (2) Cost of goods sold Year 1 734,00 277.00 $ Year 964. 284, eee 1.359, 1,589, Ye3 799. 259.0 1, 239, bne 1,254, eee (c) Total current assets (0) Total equity 1,256, 1,396, eee Required: 1. For each key financial statement figure-al.(b). (c) and (d) below-prepare a table to show the adjustments necessary to correct the reported amounts 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 1 Required 2 What is the error in total net income for the combined three-year period resulting from the inventory errors? Error in total net income of three years

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Healthcare Fraud Auditing And Detection Guide

Authors: Rebecca S. Busch

2nd Edition

978-1118179802

More Books

Students also viewed these Accounting questions

Question

Describe the role of HR in succession management.

Answered: 1 week ago