The accountant for Steele Company reported the following accounting treatments for several purchase transactions (FOB shipping point) that took place near December 31, 2003, the company’s year-end: ee ene ee eee cease ee Was the Purchase Was the Inventory Recorded in the Counted and Included Date Inventory Books on or before in Inventory Balance on Was Shipped December 31, 2003? Amount December 31, 2003? 2003: Decembe inc Omeanaa- ier Yes $1,100 Yes December Zoe erence Yes 800 No Decembeno1) oon me x No . 1,800 Yes 2004: RAIN GI leew ecm ea No 300 Yes ANIC Vail aeweieracrcwrearsan Ten pei Yes 3,000 No SAINT Vin ace mesial Rene No 600 No eae re eee ee 1. If Steele Company’s records reported purchases and ending inventory balances of $80,800 and $29,800, respectively, for 2003, what would the proper amounts in these accounts have been? 2. What would be the correct amount of cost of goods sold for 2003, if the beginning inventory balance on January 1, 2003, was $20,200? 3. By how much would cost of goods sold be over- or understated if the corrections in question (1) were not made?