beginning merchandise inventory was overstated $10,000 in 2014, purchases were
understated $7,000 in 2014 and the ending merchandise inventory was understated
$12,000 in 2015. Assume that no corrections were made during 2014 or 2015. All
other items in the income statement were correct.
affect does this have on the cost of goods sold and net income for 2014 in
dollars understated or overstated? What affect does this have on net income in retained earning in dollars, over or understated?
Thank you for helping me. I would like to know where did you get the $15,000 overstatement of COGS that impact the $15,000 overstatement of net income and $15,000 understatement of retained earnings. Could I get a solution for this problem?