Correcting inventory errors over a three-year period and computing inventory turnover and days’ sales in inventory Peaceful Carpets’s books show the following data. In early 2020, auditors found that the ending merchandise inventory for 2017 was understated by $6,000 and that the ending merchandise inventory for 2019 was overstated by $7,000. The ending merchandise inventory at December 31, 2018, was correct.

Net Sales Revenue Cost of Goods Sold: Beginning Merchandise Inventory Net Cost of Purchases Cost of Goods Available for Sale $ 22,000 139,000 161,000 Less: Ending Merchandise Inventory Cost of Goods Sold 33,000 Gross Profit Operating Expenses Net Income 2019 $216,000 $ 28,000 109,000 137,000 2018 $ 166,000 $ 41,000 98,000 139,000 128,000 88,000 62,000 22,000 2017 $ 175,000 115,000 51,000 23,000 28,000 111,000 64,000 28,000 $ 36,000 $ 26,000 $ 28,000