Segment (15,000) 2.28 On January 1, 19X3, Mistake, Inc., had a Retained Earnings balance of $75,000. During 19X3, Mistake discovered that it had understated its 19X2 revenue by $20,000. Assume a 19X2 tax rate of 30%. (a) Does this require a debit correction or a credit? Why? (b) Determine the corrected January 1, 19X3, Retained Earnings balance. 2.29 Company H had the following information relating to 19X2: 2.30 Net Income Dividends Declared Dividends Paid Retained Earnings, Jan. 1 $100,000 20,000 25,000 400,000 28,000 30% (21,000) 7,000 Error in 19X1: Understatement of Revenue Tax rate, 19X1 Unusual Loss from Sale of Stock Error in Depreciation Estimate, 19X1 (understatement) Prepare a retained earnings statement. Mistake, Inc., purchased a machine on January 1, 19X1, for $50,000 and estimated its life and salvage value to be 6 years and $3,000, respectively. Early in 19X4, Mistake realized that the remaining life is only 2 years and the salvage value will be $2,000. 58 THE INCOME STATEMENT AND RETAINED EARNINGS STATEMENT (a) What correction entry is needed, if any? (b) What will the revised depreciation be for 19X4 and after