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1 Problem Two 3 The records of Alyssa Company show the following data: 5 2021 2022 6 Sales 300,000.00 320,000.00 7 Beginning Inventory 30,000.00 22,000.00 8 Cost of Goods Purchased 200,000.00 240,000.00 9 Ending Inventory 22,000.00 31,000.00 10 Operating Expenses 60,000.00 64,000.00 11 12 Subsequent to its July 31, 2022 year end, Alyssa discovers that its inventory at the end of 2021 was actually $27,000 not $22,000. 13 14 a) Prepare both incorrect and corrected income statements for the years ended July 31, 2021 and 2022. (20) 15 16 b) What is the impact of this error on the owner's equity at July 31, 2022. (1) 17 18 Incorrect Income Statement - 2021 Correct Income Statement - 2021 19 20 Revenue: Revenue: 21 Sales 300,000.00 Sales 22 23 Cost of Goods Sold: Cost of Goods Sold: 24 Beginning Inventory 30,000.00 Beginning Inventory 25 Cost of Goods Purchased 200,000.00 Cost of Goods Purchased 26 Cost of Goods Available for Sa 230,000.00 Cost of Goods Available for Sa 27 Ending Inventory 22,000.00 Ending Inventory 28 Cost of Goods Sold 208,000.00 Cost of Goods Sold 29 30 Gross Profit 92,000.00 Gross Profit 31 Operating Expenses 60,000.00 Operating Expenses 32 33 Net Income 32,000.00 Net Income 2 35 36 Incorrect Income Statement - 2022 Correct Income Statement - 2022 37 38 Revenue: Revenue: 39 Sales 320,000.00 Sales 40 41 Cost of Goods Sold: Cost of Goods Sold: 42 Beginning Inventory 22,000.00 Beginning Inventory 43 Cost of Goods Purchased 240,000.00 Cost of Goods Purchased 44 Cost of Goods Available for Sa 262,000.00 Cost of Goods Available for Sa 45 Ending Inventory 31,000.00 Ending Inventory 46 Cost of Goods Sold 231,000.00 Cost of Goods Sold 47 48 Gross Profit 89,000.00 Gross Profit 49 Operating Expenses 64,000.00 Operating Expenses 50 51 Net Income 25,000.00 Net Income