A company discovered in 2020 that it had overstated the inventory balance for Dec 31, 2018 by $30,000. The company had (incorrectly) reported Net Income to be $900,000 for 2018, and $1,200,000 for 2019. What are the corrected Net Incomes for 2018 and 2019?

Question

Quizplus · Accepted Answer

Cost of Goods Sold = Beginning Inventory + Purchases - Ending Inventory:
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A Company Discovered in 2020 That It Had Overstated the Inventory