Navajo Company's year-end financial statements show the following. The company recently discovered that in making physical...

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Navajo Company's year-end financial statements show the following. The company recently discovered that in making physical counts of inventory, it had made the following errors: Year 1 ending inventory is understated by $59,000 and Year 2 ending inventory is overstated by $29,000. For Year Ended December 31 (a) Cost of goods sold Year 1 $734,000 Year 3 $ 799,000 Year 2 $964,000 284,000 1,369,000 (b) Net income 277,000 (e) Total current assets 259,000 1,239,000 1,256,000 (d) Total equity 1,396,000 1,589,000 1,254,000 Required: 1. For each key financial statement figure-(a), (b), (c), and (d) above-prepare a table to show the adjustments necessary to correct the reported amounts. 2. What is the total error in combined net income for the three-year period resulting from the inventory errors? Complete this question by entering your answers in the tabs below. Required 1 Required 2 For each key financial statement figure-(a), (b), (c), and (d) above-prepare a table to show the adjustments necessary to correct the reported amounts. (Amounts to be deducted must be entered with a minus sign.) Year 1 Year 2 Year 3 Cost of goods sold Reported amount Adjustment for 12/31/Year 1 error Adjustment for 12/31/Year 2 error Corrected amount Net income Reported amount Adjustment for 12/31/Year 1 error Adjustment for 12/31/Year 2 error Corrected amount Total current assets Reported amount Adjustment for 12/31/Year 1 emor Adjustment for 12/31/Year 2 error Corrected amount Equity Reported amount Adjustment for 12/31/Year 1 error Adjustment for 12/31/Year 2 error Conected amount S 0$ 0$ 0 $ 0$ 0$ 0 $ 0 $ 0 0 0 Navajo Company's year-end financial statements show the following. The company recently discovered that in making physical counts of inventory, it had made the following errors: Year 1 ending inventory is understated by $59,000 and Year 2 ending inventory is overstated by $29,000. For Year Ended December 31 (a) Cost of goods sold Year 1 $734,000 Year 3 $ 799,000 Year 2 $964,000 284,000 1,369,000 (b) Net income 277,000 (e) Total current assets 259,000 1,239,000 1,256,000 (d) Total equity 1,396,000 1,589,000 1,254,000 Required: 1. For each key financial statement figure-(a), (b), (c), and (d) above-prepare a table to show the adjustments necessary to correct the reported amounts. 2. What is the total error in combined net income for the three-year period resulting from the inventory errors? Complete this question by entering your answers in the tabs below. Required 1 Required 2 For each key financial statement figure-(a), (b), (c), and (d) above-prepare a table to show the adjustments necessary to correct the reported amounts. (Amounts to be deducted must be entered with a minus sign.) Year 1 Year 2 Year 3 Cost of goods sold Reported amount Adjustment for 12/31/Year 1 error Adjustment for 12/31/Year 2 error Corrected amount Net income Reported amount Adjustment for 12/31/Year 1 error Adjustment for 12/31/Year 2 error Corrected amount Total current assets Reported amount Adjustment for 12/31/Year 1 emor Adjustment for 12/31/Year 2 error Corrected amount Equity Reported amount Adjustment for 12/31/Year 1 error Adjustment for 12/31/Year 2 error Conected amount S 0$ 0$ 0 $ 0$ 0$ 0 $ 0 $ 0 0 0

Answer rating: 100% (QA)

1 b Total of net income before correction 820000 Total of net income after correction 8... View the full answer