hi, l would like you to help me answer a question. the two income statement data for the two years ended December 31, are as follows.

2014

sales 600,000

cost of goods sold 45,000

gross profit 150000

2013

sales 600,000

cost of goods sold 45,000

gross profit 150,000

the inventory for January 1, 2013 and December 31, 2014 are correct. however, the ending inventory for December 31, 2013 was understated by $20,000,

these are the instructions:

#a prepare the gross income statement up to gross profit for the two years.

#b what is the combined effect on gross profit for the two years?

#c calculate the gross profit margin for the two years before and after the correction.

thanks, this is very helpful.