Presented below are the comparative income statements for Pannebecker Inc. for the years 2014 and 2015.

The following additional information is provided.
1. In 2015, Pannebecker Inc. decided to switch its depreciation method from sum-of-the-years’-digits to the straight-line method. The assets were purchased at the beginning of 2014 for $90,000 with an estimated useful life of 4 years and no residual value. (The 2015 income statement contains depreciation expense of $27,000 on the assets purchased at the beginning of 2014.)
2. In 2015, the company discovered that the ending inventory for 2014 was overstated by $20,000; ending inventory for 2015 is correctly stated.
Instructions Prepare the revised retained earnings statement for 2014 and 2015, assuming comparative statements.
(Ignore income taxes.)

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2015 2014 Sales $340,000 $270,000 Cost of sales 200,000 142,000 Gross profit 140,000 128,000 Expenses 88,000 50,000 Net income $ 52,000 Retained earnings (Jan. 1) Net income Dividends Retained earnings (Dec. 31) $125,000 52,000 $ 78,000 $ 72,000 78,000 (30,000) $147,000 (25,000) $125,000