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Question: Uptown Mart reported the following amounts on their financial statements for 2012, 2013, and 2014...

Uptown Mart reported the following amounts on their financial statements for 2012, 2013, and 2014:

(Note: Pages 233-234 explain the effect of inventory errors. Use them to work on this problem.)

	For the Year Ended December 31
	2012	2013	2014
Cost of goods sold	$95,000	$107,000	$87,000
Net income	32,000	26,000	24,000
Total current assets	145,000	152,000	120,000
Equity	238,000	255,000	268,000

It was discovered early in 2015 that the ending inventory on December 31, 2012, was overstated by $8,000 and the ending inventory on December 31, 2013, was understated by $3,500. The ending inventory on December 31, 2014, was correct. Ignoring income taxes, determine the correct amounts of cost of goods sold, net income, total current assets, and equity for each of the years 2012, 2013, and 2014.

2012:	Cost of goods sold = Net income = Total current assets = Equity =
2013:	Cost of goods sold = Net income = Total current assets = Equity =
2014:	Cost of goods sold = Net income = Total current assets = Equity =

	For the Year Ended December 31
	2012	2013	2014
Cost of goods sold
Net income
Total current assets
Equity

Please explain why you are adding or subtracting something, thank you.

Answer 1

Req :
2012   Cost of goods sold = 95000+8000 = 103,000
Net Income : 32000-8000 = 24000
Total Current Assets : 145000 -8000 = 137,000
Equity : 238000 -8000 = 230,000
2013   Cost of goods sold = 107000-8000-3500 =95500
Net Income : 26000+8000+3500= 37500
Total Current Assets : 152000 +3500 =155500
Equity : 255000 +11500 = 266500
2014   Cost of goods sold = 87000+3500 =90500
Net Income : 24000-3500= 20500
Total Current Assets : 120000
Equity : 268000-3500 = 264500
				2012	2013	2014
	Cost of Goods sold			103000	95500	90500
	Net Income			24000	37500	20500
	Total Current assets			137000	155500	120000
	Equity			230000	266500	264500