The image presents a worksheet designed to calculate the adjusted net income for the years 2017 to 2021, considering inventory errors. The table is organized as follows:**Columns:**1. **Year:** Lists the years from 2017 to 2021.2. **Net Income Per Books:** Displays the reported net income for each year.3. **Errors in Inventories:** - **Overstatement Jan. 1:** A column to record any overstatement of inventory at the beginning of each year. - **Understatement Jan. 1:** A column to record any understatement of inventory at the beginning of each year. - **Overstatement Dec. 31:** A column to record any overstatement of inventory at the end of each year.**Rows:**- Each row corresponds to a specific year from 2017 to 2021, with an additional row at the bottom for any necessary calculations or adjustments.**Details:**- **2017:** Reported net income is $186,000.- **2018:** Reported net income is $84,000.- **2019:** Reported net income is $105,000.- **2020:** Reported net income is $221,000.- **2021:** Reported net income is $99,000.Empty boxes are provided to fill in the inventory errors for each specified category and year. The intention is to adjust the net income by accounting for any errors that may have occurred in inventory reporting. The following information is presented for Bramble Corporation. The net income figures were computed without knowledge of the errors in ending inventory. Assume that there was no error in the 2016 ending inventory.| Year | Net Income per Books | Error in Ending Inventory ||------|----------------------|---------------------------|| 2017 | $186,000 | Overstated $22,600 || 2018 | $84,000 | Overstated $34,000 || 2019 | $105,000 | No error || 2020 | $221,000 | Understated $6,200 || 2021 | $99,000 | Understated $18,000 |**Instructions:**Prepare a worksheet to show the adjusted net income figure for each year from 2017 to 2021 after taking into account the inventory errors.

Inventory management involves keeping track of the goods, components, and raw materials that a…

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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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Whispering Winds Supply Company reports net income of $141,600 in 2023. The ending inventory did not include goods valued at $10,620 that Whispering Winds Supply had consigned to Staples. (For question answer please scroll far right) (1) What impact will this error have on the income statement for 2023? If ending inventory is ✓by $ (2) (3) What is the correct net income for 2023? The correct net income is $ 2 On the balance sheet, both inventory and retained earnings will be cost of goods sold will be What impact will this error have on the balance sheet at December 31, 2023? by $ and net
Caterpillar Inc (CAT) has the following excerpts from their financial statements December 31, 2021 December 31, 2020 Inventory (in $ Millions) 14,038 11,402 Net Income(in $ Millions) 6,489 2,998 Inventories are principally determined using the last-in, first-out (LIFO) method. The value of inventories on the LIFO basis. If the FIFO (first-in, first-out) method had been in use, inventories would have been $3,258 million and $2,921 million higher than reported at December 31, 2021 and 2020, respectively. Assume corporate tax rate of 21%. If CAT had used FIFO method instead of LIFO method What inventory (in $ Millions) would CAT report for 2021? What net income (profit) would CAT report in 2021? What is the cumulative amount of income tax savings that CAT generated through end of 2021 by using LIFO instead of FIFO? What…
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Errors in Inventory Count Bow Corp. accidentally overstated its 2015 ending inventory by $750. Assume that ending 2016 inventory is accurately counted. The error in 2015 will have what effect on Bow Corp.? Oa. 2015 net income is understated by $750 Ob. 2015 net income is overstated by $750. Oc, 2016 net income is understated by $750. Od. Both b and c are correct.
On January 1, 2023 , Linda Corp. changed from the average cost to the dollar value LIFO method for accounting for inventory. The change results in a decrease in ending inventory of $45,497,000 for the year. How should the effect of this change be reported by Linda Corp. in 2023? (RE& CF 1) As an increase to beginning RE of $ 45,497,000 As a decrease to beginning RE of $45,497,000 As an increase to net income of $45,497,000 As a decrease to net income of $45,497,000
If Wakowski Company's ending inventory was actually $86,000 but was adjusted at year end to a balance of $68,000 in error, what would be the impact on the presentation of the balance sheet and income statement for the year that the error occurred, if any? If no entry is required, select "None" and leave the amount boxes blank. Balance Sheet: Merchandise Inventory $4 Current Assets Total Assets Retained Earnings Income Statement: Cost of Goods Sold Gross Profit/Gross Margin Net Income
Ending inventory for the year ended December 31, 2017, is understated by $15,000. How will this error affect net income for 2018? Net income will be understated by $30,000. Net income will be understated by $15,000. O Net income will be overstated by $15,000. O Net income will be overstated by $30,000. O The understatement of inventory in 2017 will not affect income in 2018.
The following information is presented for Marigold Corporation. The net income figures were computed without knowledge of the errors in ending inventory. Assume that there was no error in the 2016 ending inventory. Year Net Incomeper Books Error in EndingInventory 2017 $ 180,000 Overstated $ 23,000 2018 93,000 Overstated 35,000 2019 108,000 No error - 2020 218,000 Understated 6,200 2021 97,000 Understated 19,500 Prepare a worksheet to show the adjusted net income figure for each year from 2017 to 2021 after taking into account the inventory
Presented below is information related to Kingbird, Inc. End-of-Year Inventory Price Date (End-of-Year Prices) Index December 31, 2017 $ 1,200,000 100 December 31, 2018 1,522,500 105 December 31, 2019 1,562,000 110 December 31, 2020 1,813,500 117 Compute the ending inventory for Kingbird, Inc. for 2017 through 2020 using the dollar-value LIFO method. Ending Inventory 2017 2018 2019 2020 $ %24 %24
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