Jacob?s Upholstery, Inc., reported the following comparative income statements for the years ended September 30, 2018, and
Question:
Jacob?s Upholstery, Inc., reported the following comparative income statements for the years ended September 30, 2018, and September 30, 2017.
During 2018, Jacob?s Upholstery, Inc., discovered that the 2017 ending inventory, as previously reported, was understated by $1,500.
Requirements
1. Prepare the corrected comparative income statements for the two-year period, complete with a heading for the statements.
2. What was the effect of the error on net income for the two years combined? Explain your answer.
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