(Figure)Shetland Company reported net income on the year-end financial statements of $125,000.

However, errors in inventory were discovered after the reports were issued. If inventory was
understated by $15,000, how much net income did the company actually earn?

(Figure)If a group of inventory items costing $3,200 had been double counted during the year-end
inventory count, what impact would the error have on the following inventory calculations? Indicate the
effect (and amount) as either (a) none, (b) understated $______, or (c) overstated $______.

Inventory Item None or amount? Understated or overstated?

Beginning Inventory    

Purchases    

Goods Available for

   
Sale

Ending Inventory    

Cost of Goods Sold    

(Figure)If Barcelona Company’s ending inventory was actually $122,000, but the cost of consigned
goods, with a cost value of $20,000 were accidentally included with the company assets, when making
the year-end inventory adjustment, what would be the impact on the presentation of the balance sheet
and income statement for the year that the error occurred, if any?

(Figure)Tanke Company reported net income on the year-end financial statements of $850,200.
However, errors in inventory were discovered after the reports were issued. If inventory was overstated
by $21,000, how much net income did the company actually earn?

(Figure)Company Elmira reported the following cost of goods sold but later realized that an error had
been made in ending inventory for year 2021. The correct inventory amount for 2021 was 32,000. Once
the error is corrected, (a) how much is the restated cost of goods sold for 2021? and (b) how much is the
restated cost of goods sold for 2022?