Carter Company Reported These Income Statement Data for a 2-Year

question 209

Essay

Carter Company reported these income statement data for a 2-year period. Carter Company uses a periodic inventory system. The inventories at January 1, 2013, and December 31, 2014, are correct. However, the ending inventory at December 31, 2013, is overstated by $4,000.
Instructions
(a) Prepare correct income statement data for the 2 years.
(b) What is the cumulative effect of the inventory error on total gross profit for the 2 years?

---

Definitions:

Bicultural Audit

An evaluation process that examines the integration, interaction, and function of two distinct cultures within an organization or societal context.

Cultural Relations

The interactions and relationships between individuals or groups from different cultural backgrounds, encompassing understanding, communication, and often collaboration across cultural lines.

Cultural Clashes

Conflicts or mismatches arising from differing beliefs, values, practices, or expectations between cultures or within a multicultural environment.

Adaptive Corporate Culture

A corporate culture that is flexible, responsive, and able to change in response to external conditions or internal strategies.