Here is the original schedule of cost of goods sold for Truman Company for the years of 2014 through 2017:

During the preparation of its 2017 financial statements, Truman Company discovered that its 2015 ending inventory was understated by $200. Make the correction to the 2015 ending inventory and all other numbers in the schedule of cost of goods sold for any years affected.
1. What is the corrected cost of goods sold for 2015?
2. Did the understatement of ending inventory in 2015 cause the 2015 cost of goods sold to be overstated or understated!
3. What is the corrected cost of goods sold for 2016?
4. Did the understatement of ending inventory in 2015 cause the 2016 cost of goods sold to be overstated or understated!
5. Were any other years impacted by the 2015 $200 understatement of ending inventory? Why or why not?

Transcribed Image Text:

A1 2017 201620152014 2 Beginning inventory 3 +Purchases 4Cost of goods available 5 -Ending inventory 6 Cost of goods sold S 350ļ. Š-500 Ls 600, s 400 1250145011001,000 1,60019501700 1400 450 500