By the Bay Marine Supply reported the following comparative income statements for the years ended June 30, 2012, and 2011:

By the Bay€™s president and shareholders are thrilled by the company€™s boost in sales and net income during 2012. Then the accountants for the company discover that ending 2011 inventory was understated by $8,000. Prepare the corrected comparative income statements for the two-year period, complete with a heading for the statements. How well did By the Bay really perform in 2012 as compared with2011?

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By the Bay Marine Supply Income Statements For the Years Ended June 30, 2012, and 2011 2012 2011 Sales revenue $138,000 $120,000 Cost of goods sold: Beginning inventory Net purchases Cost of goods available Ending inventory Cost of goods sold $ 12,000 78,000 90,000 $ 9,500 75,000 84,500 Gross profit Operating expenses Net income 73,500 64,500 30,000 S 34,500 72,500 47,500 25,000 S 22,500