In 2010 Townsend Inc discovered that its ending inventory in 2009 was too big by $95,000.How much will Townsend'ss beginning retained earnings (Jan.1,2010) need to be adjusted to correct this error given a tax rate of 30%.
A) Increase retained earnings $66,500
B) Do not adjust retained earnings
C) Decrease retained earnings by $95,000
D) Decrease retained earnings $66,500.
Correct Answer:
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