Griffin Corporation prepared the following two income statements (simplified for illustrative purposes): Sales revenue Cost of goods sold Beginning inventory Purchases Goods available for sale Ending inventory Cost of goods sold Gross profit Expenses Pretax income First Quarter $ 4,200 2,800 7,000 3,700 Required 1 $ 12,800 3,308 9,500 4,800 $4,708 Second Quarter Required 2 Required 3 Required 4 $ 3,700 12, 200 15,900 9,000 During the third quarter, it was discovered that the ending Inventory for the first quarter should have been $4,280. Required: 1. What effect did this error have on the combined pretax income of the two quarters? 2. Which quarter's or quarters (if any) EPS amounts were affected by this error? 3. Prepare corrected Income statements for each quarter. 4. Prepare the schedule to reflect the comparative effects of the correct and incorrect amounts on the income statement. Required 1 $18,300 Complete this question by entering your answers in the tabs below. 6,900 11,400 5,300 $ 6,100 What effect did this error have on the combined pretax income of the two quarters? Effect on combined pretax income Required 2 >

Griffin Corporation prepared the following two income statements (simplified for illustrative purposes): Sales revenue Cost of goods sold Beginning inventory Purchases Goods available for sale Ending inventory Cost of goods sold Gross profit Expenses Pretax income First Quarter $ 4,200 2,800 7,000 3,700 Required 1 $ 12,800 3,308 9,500 4,800 $4,708 Second Quarter Required 2 Required 3 Required 4 $ 3,700 12, 200 15,900 9,000 During the third quarter, it was discovered that the ending Inventory for the first quarter should have been $4,280. Required: 1. What effect did this error have on the combined pretax income of the two quarters? 2. Which quarter's or quarters (if any) EPS amounts were affected by this error? 3. Prepare corrected Income statements for each quarter. 4. Prepare the schedule to reflect the comparative effects of the correct and incorrect amounts on the income statement. Required 1 $18,300 Complete this question by entering your answers in the tabs below. 6,900 11,400 5,300 $ 6,100 What effect did this error have on the combined pretax income of the two quarters? Effect on combined pretax income Required 2 >

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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