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The reported net incomes for the first 2 years of Splish Products, Inc., were as follows: 2020, $147,800; 2021, $202,000. Early in 2022, the following
The reported net incomes for the first 2 years of Splish Products, Inc., were as follows: 2020, $147,800; 2021, $202,000. Early in 2022, the following errors were discovered.
1. | Depreciation of equipment for 2020 was overstated $15,900. | |
2. | Depreciation of equipment for 2021 was understated $38,300. | |
3. | December 31, 2020, inventory was understated $49,500. | |
4. | December 31, 2021, inventory was overstated $14,900. |
Prepare the correcting entry necessary when these errors are discovered. Assume that the books are closed. (Ignore income tax considerations.)
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