Ascertain the correct amounts of cost of goods sold and gross profit, assuming that ending inventory was accidentally overstated by $2,800.

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Chapter 5, Problem 12SE

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Ascertain the correct amounts of cost of goods sold and gross profit, assuming that ending inventory was accidentally overstated by $2,800.

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years ended June 30, 2019 and 2018: Cost of Goods Available for Sale Nature Foods Grocery reported the following comparative income statements for the Beginning Merchandise Inventory Less: Ending Merchandise Inventory During 2019, Nature Foods Grocery discovered that ending 2018 merchandise inven- inventory error-two years an Merchandise Inventory 361 Learning Objective 5 1.2019, NI $36,500 NATURE FOODS GROCERY Income Statements Years Ended June 30, 2019 and 2018 2019 Net Sales Revenue Cost of Goods Sold: 2018 $ 134,000 $ 119,000 $ 17,000 78,000 $ 14,000 67,000 81,000 Net Cost of Purchases 95,000 18,000 17,000 Cost of Goods Sold 77,000 64,000 57,000 Gross Profit 55,000 Operating Expenses 26,000 21,000 $ 31,000 Net Income $ 34,000 tory was overstated by $5,500. Requirements 1. Prepare corrected income statements for the two years. 2. 2 State whether each year's net income-before your corrections-is understated or overstated, and indicate the amount of the understatement or…

For all problems, assume the perpetual inventory system is used unless stated otherwise. P6-28A Accounting for inventory using the perpetual inventory system- FIFO, LIFO, and weighted-average Fit Gym began January with merchandise inventory of 78 crates of vitamins that cost a total of $4,290. During the month, Fit Gym purchased and sold merchandise on Merchandise Inventory 363 Learning Objectives 2, 3 2. Ending Merch. Inv., $990 account as follows: Jan. 5 Purchase 156 crates @ $ 64 each 13 Sale 180 crates @$ 100 each 18 Purchase 114 crates @ $ 75 each 26 Sale 150 crates @ $ 116 each Requirements 1 Prepare a perpetual inventory record, using the FIFO inventory costing method, and determine the company's cost of goods sold, ending merchandise inventory, and gross profit. 2. Prepare a perpetual inventory record, using the LIFO inventory costing method, and determine the company's cost of goods sold, ending merchandise inventory, and gross profit. 3. Prepare a perpetual inventory record,…

(Learning Objectives 1, 2: Show how to account for inventory transactions; applythe FIFO cost method) Griffin Company’s inventory records for its retail division show thefollowing at December 31:Dec 1 Beginning inventory ............... 9 units @ $165 = $1,48515 Purchase................................. 5 units @ 166 = $ 83026 Purchase................................. 13 units @ 175 = $2,275At December 31, 11 of these units are on hand. Journalize the following for Griffin Companyunder the perpetual system:1. Total December purchases in one summary entry. All purchases were on credit.2. Total December sales and cost of goods sold in two summary entries. The selling price was$500 per unit, and all sales were on credit. Assume that Griffin uses the FIFO inventorymethod.3. Under FIFO, how much gross profit would Griffin earn for the month ending December 31?What is the FIFO cost of Griffin Company’s ending inventory?