Lowell Corporation has used the accrual basis of accounting for several years. A review of the records, however, indicates that some expenses and revenues have been handled on a cash basis because of errors made by an inexperienced bookkeeper. Income statements prepared by the bookkeeper reported €29,000 net income for 2014 and €37,000 net income for 2015. Further examination of the records reveals that the following items were handled improperly.

1. Rent was received from a tenant in December 2014. The amount, €1,000, was recorded as income at that time even though the rental pertained to 2015.

2. Salaries and wages payable on December 31 have been consistently omitted from the records of that date and have been entered as expenses when paid in the following year. The amounts of the accruals recorded in this manner were:

3. Invoices for office supplies purchased have been charged to expense accounts when received. Inventories of supplies on hand at the end of each year have been ignored, and no entry has been made for them.

Instructions Prepare a schedule that will show the corrected net income for the years 2014 and 2015. All items listed should be labeled clearly. (Ignore income tax considerations.)

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December 31, 2013 December 31, 2014 1,100 1,200 December 31, 2015 940