Dows Company Prepared Income Statements That Reflected Pretax Income of $21,000

question 82

Essay

Dows Company prepared income statements that reflected pretax income of $21,000 for 2013 and $30,000 for 2014. An audit has determined that there were two errors in the inventory amounts as follows: Required:
Determine the correct pretax income amount for each year (show computations; assume the errors were not corrected):

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Definitions:

Conformity

The act of matching attitudes, beliefs, and behaviors to what people perceive as normal to a specific society or social group.

Social Norms

The attitudes and standards of behavior expected of members of a particular group.

Conformity

The practice of aligning one's attitudes, beliefs, and actions with those of a group or conforming to its norms and politics.

Solomon Asch

A psychologist known for his research on conformity, demonstrating how group pressure can influence individual judgments.