Brilliant Video Sales Ltd. reported the following data. The shareholders are very happy with Brilliant's steady...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Brilliant Video Sales Ltd. reported the following data. The shareholders are very happy with Brilliant's steady increase in net income. (Click the icon to view the income statements.) Auditors discovered that the ending inventory for 2018 was understated by $3 million and that the ending inventory for 2019 was also understated by $3 million. The ending inventory at December 31, 2020, was correct. Requirements 1. Show corrected income statements for each of the three years. 2. How much did these assumed corrections add to or take away from Brilliant's total net income over the three-year period? How did the corrections affect the trend of net income? 3. Will Brilliant's shareholders still be happy with the company's trend of net income? Give a reason for your answer. Requirement 1. Show corrected income statements for each of the three years. Brilliant Video Sales Ltd. Income Statements (adapted; amounts in millions) Years Ended December 31, 2020, 2019, and 2018 Net sales revenue 2020 2019 2018 Cost of goods sold: Beginning inventory Purchases Goods available for sale Less: Ending inventory Cost of goods sold Gross profit Total operating expenses Net income Requirement 2. How much did these assumed corrections add to or take away from Brilliant's total net income over the three-year period? How did the corrections affect the trend of net income? How much did these assumed corrections add to or take away from Brilliant's total net income over the three-year period? The assumed corrections over the three-year period. How did the corrections affect the trend of net income? The corrections Requirement 3. Will Brilliant's shareholders still be happy with the company's trend of net income? Give a reason for your answer. Will Brilliant's shareholders still be happy with the company's trend of net income? The shareholders be happy with the trend of net income because the company's C Income statements Brilliant Video Sales Ltd. Income Statements for the Years Ended (Amounts in millions) 2020 Net sales revenue $ 45 2019 $ 2018 42 $ 39 Cost of goods sold: Beginning inventory Purchases $ 8 $ 7 S 6 30 28 26 Goods available for sale 38 35 32 Less: Ending inventory (9) (8) (7) 29 27 25 Cost of goods sold Gross profit 16 15 14 1 1 Total operating expenses $ 15 14 S 13 Net income Print Done - X Brilliant Video Sales Ltd. reported the following data. The shareholders are very happy with Brilliant's steady increase in net income. (Click the icon to view the income statements.) Auditors discovered that the ending inventory for 2018 was understated by $3 million and that the ending inventory for 2019 was also understated by $3 million. The ending inventory at December 31, 2020, was correct. Requirements 1. Show corrected income statements for each of the three years. 2. How much did these assumed corrections add to or take away from Brilliant's total net income over the three-year period? How did the corrections affect the trend of net income? 3. Will Brilliant's shareholders still be happy with the company's trend of net income? Give a reason for your answer. Requirement 1. Show corrected income statements for each of the three years. Brilliant Video Sales Ltd. Income Statements (adapted; amounts in millions) Years Ended December 31, 2020, 2019, and 2018 Net sales revenue 2020 2019 2018 Cost of goods sold: Beginning inventory Purchases Goods available for sale Less: Ending inventory Cost of goods sold Gross profit Total operating expenses Net income Requirement 2. How much did these assumed corrections add to or take away from Brilliant's total net income over the three-year period? How did the corrections affect the trend of net income? How much did these assumed corrections add to or take away from Brilliant's total net income over the three-year period? The assumed corrections over the three-year period. How did the corrections affect the trend of net income? The corrections Requirement 3. Will Brilliant's shareholders still be happy with the company's trend of net income? Give a reason for your answer. Will Brilliant's shareholders still be happy with the company's trend of net income? The shareholders be happy with the trend of net income because the company's C Income statements Brilliant Video Sales Ltd. Income Statements for the Years Ended (Amounts in millions) 2020 Net sales revenue $ 45 2019 $ 2018 42 $ 39 Cost of goods sold: Beginning inventory Purchases $ 8 $ 7 S 6 30 28 26 Goods available for sale 38 35 32 Less: Ending inventory (9) (8) (7) 29 27 25 Cost of goods sold Gross profit 16 15 14 1 1 Total operating expenses $ 15 14 S 13 Net income Print Done - X
Expert Answer:
Posted Date:
Students also viewed these accounting questions
-
Lab Report Procedure: 1. Sampling and Data Collection: Select a parking lot as the outdoor environment and an indoor setting for comparison. Use a particulate matter monitor to collect data on the...
-
Columbia Video Sales Ltd. reported the following data. The shareholders are very happy with Columbia's steady increase in net income. Auditors discovered that the ending inventory for 2015 was...
-
The accounting records of Downton Home Store show these data (in millions). The shareholders are very happy with Downtons steady increase in net income. Auditors discovered that the ending inventory...
-
Which of the following would be the most frequently occurring daily transaction in a retail shop? (a) Paying salary to the sales assistant (b) Sale of goods (c) Payment of rent for the shop premises...
-
Use the LexisNexis Academic Legal Search option to answer the following questions: a. Use the Tax Law database and perform a terms and connectors search using the following terms: taxing, barter, and...
-
Read the topic of American Yawp and in an essay approximately compare and contrast the European values and ways of life with those of Native-Americans. Consider addressing religion, land ownership,...
-
The management of Ercall Limited pays particular attention to the ratios and percentages which they calculate from their annual accounts. For the year ended 31 December 2009, they have calculated the...
-
The president of Giraldi Enterprises asks if you could indicate the impact certain transactions have on the following ratios. 1. Received $5,000 on cash sale. The cost of the goods sold was $2,600....
-
Big Tasty Bird Inc. (BTB) is a turkey farm. BTB year-end is September 30, 2020. It takes about four to six months to raise a turkey from the time the chicks hatch from their eggs. A full-grown and...
-
Compare your monthly income to your total expenses above (plus any other expenses that you think are reasonable). If your income is equal to or greater than your expenses, describe what you could do...
-
Find the latest 10-K filing of Verizon, the large telecommunications company. Determine whether they use interest rate and currency swaps and why.
-
Many years ago, Brad purchased $300,000 of coverage on his dwelling under a HO-3 policy. On July 4th, his house caught fire and he suffered damages of $120,000. The replacement cost, excluding the...
-
What are the main assumptions when VaR is calculated using the Historical Simulation (HS) method. What are the advantages and disadvantages of the HS methods and how does HS compares to the Weighted...
-
An investment of $20000 will create a perpetual after-tax cash flow of $2000. The required return is 7%, what's the Profitability Index of the project?
-
Wilmur Corporation has announced that it will pay its first annual stock dividend of $1.05 per share exactly two years from today.Analysts estimate that this dividend will grow by 1.5% per year in...
-
The management of Unter Corporation, an architectural design firm, is considering an investment with the following cash flows: Investment Year $ 75,000 $ 7,000 Cash Inflow $ 6,000 $ 12,000 123456789...
-
The outer loop controls the number of students. Note that the inner loop of this program is always executed exactly three times, once for each day of the long weekend. Modify the code so that the...
-
for determining whether operations have been discontinued and the problems that might arise in applying them. 5 Annual accounts have been put into such a straitjacket overemphasis on uniform...
-
The directors of Ufool Ltd are aware that a sizeable number of shareholders, although still a minority, are extremely unhappy with current dividend levels and are agitating for larger distributions....
-
Explain the conditions set out in IFRS
Study smarter with the SolutionInn App