Question 2 You are in the year-end preparation of the 2018 financial statements for Kepler Corp. The books are not yet closed for 2018. You discover that Kepler expensed the entire cost of equipment acquired on 1/1/2015. The equipment cost $40,000 and has an 8 year useful life with no residual value. In the 2017 financial statements, Kepler reported Net Income (2017) = $50,000 and Retained Earnings (1/1/2017) = 100,000. Both amounts were, of course, incorrect because of the equipment error. What should be reported in the 2018 financial statements for accounts after correcting for the error? Net Income (2017) - 535.000; Retained Earnings. 1/1/2017 - 120.000 Net Income (2017) = $40,000: Retained Earnings, 1/1/2017 = 115.000 You Answered Net Income (2017) - $45,000; Retained Earnings, 1/1/2017 = 125,000 Correct Answer Net Income (2017) - $45,000: Retained Earnings. 1/1/2017 = 130,000