The reported net incomes for the first 2 years of US Books Corp. were as follows: 2009, $268,000; and 2010, $412,000. Early in 2011, the following entries were discovered.

Depreciation of equipment for 2009 was understated $68,500

Depreciation of equipment for 2010 was overstated $39,000

December 31, 2009, inventory was overstated $12,000

December 31, 2010, inventory was understated $73,600

Instructions

Prepare the correcting entry necessary when those errors are discovered. Assume that the books are closed. (Ignore income tax considerations.)