The reported net incomes for the first 2 years of Splish Products, Inc., were as follows:...

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.)

Expert Solution

ekkarill92 answered 1 year ago

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