Problem 16-7 - Paul company
what amount should be reported as net effect of the errors on retained earnings on Jan. 01, 2022?
Year 1
Year 2
Understatement of
Inventory
60,000
-
60,000
Overstatement of
Inventory
-
75,000
corrected net income
60,000
-
135,000
retained earnings
correct amount in Year 1
60,000
correct amount in Year 2
-
135,000
- 75,000
C.
Problem 16-8 - Crescendo company
what amount should be reported as net effect of the errors on retained earnings on Jan. 01, 2021?
Year 1
Year 2
Understatement of
Inventory
-
150,000
150,000
Overstatement of
Inventory
200,000
understatement of rent expense
-
50,000
Overstatement of rent expense
100,000
corrected amount
- 200,000
450,000
A.