At December 31, 2014, Daewoo Inc. reported total assets of W402,590,000, and net income of W100,670,000 for the current year. Daewoo determined that inventory was overstated by W3,200,000 at the beginning of 2015 (this was not corrected). What is Daewoo's corrected amount for total assets for 2014?

Question

Quizplus · Accepted Answer

The corrected amount for total assets for 2014 is calculated by subtracting the overstated amount of inventory from the reported total assets, and then adding the net income. 
Corrected total assets = Reported total assets - Overstated inventory + Net income
= W402,590,000 - W3,200,000 + W100,670,000
= W399,390,000