The before-tax income for Hawks Corp. for 2019 was $111,400; for 2020, it was $78,600. However, the accountant noted that the following errors had been made:

1.Sales for 2019 included $38,800that had been received in cash during 2019, but for which the related products were delivered in 2020. Title did not pass to the purchaser until 2020.2.Ending inventory on December 31, 2019, was understated by $8,730. The December 31, 2020 ending inventory has not yet been adjusted to the Inventory account. Assume that Hawks has a periodic inventory system and that no adjustment has been made to the opening balance of the Inventory account.3.The bookkeeper, in recording interest expense for both 2019 and 2020 on bonds payable, made the following entry each year:

Interest Expense15,000Cash15,000

The bonds have a face value of $250,000and pay a stated interest rate of6%. They were issued at a discount of $10,000on January 1, 2019, to yield an effective interest rate of7%. (Use the effective interest method.)4.Ordinary repairs to equipment had been charged in error to the Equipment account during 2019 and 2020. In total, repairs in the amount of $9,000in 2019 and $9,100in 2020 were charged in this way. The company uses the declining balance method and applies a rate of10% in determining its depreciation charges.

Assume that Hawks Corp. applies IFRS.

Prepare a schedule showing the calculation of corrected income before tax for 2019 and 2020.

Income before tax$$Corrections:Sales erroneously included in 2019 incomeUnderstatement of 2019 ending inventoryAdjustment to bond interest expenseRepairs erroneously charged to the Equipment accountDepreciation recorded on improperly capitalized repairsCorrected income before tax$$