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

question 119

Short Answer

Dows Company prepared income statements that reflected pretax income of $21,000 for 2010 and $30,000 for 2011.An audit has determined that there were two errors in the inventory amounts as follows:
$$\begin{array} { l c c } & \begin{array} { c } \text { Amount } \\\text { Reported }\end{array} & \underline { \text { Correct Amount } } \\\text { Ending inventory, 2010 } & \$ 15,000 & \$ 14,000 \\\text { Ending inventory, 2011 } & 18,000 & 16,000\end{array}$$ Determine the correct pretax income amount for each year (show computations assuming the errors were not corrected)

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Definitions:

Lack Of Sleep

The condition of not getting an adequate amount of rest or sleep, which can affect health and cognitive functions.

Somnambulism

Also known as sleepwalking, it is a behavior disorder originating during deep sleep leading to walking or performing other complex behaviors while asleep.

Sleep Apnoea

A sleep disorder where breathing repeatedly stops and starts during sleep, often leading to daytime fatigue.

Night Terror

A sleep disorder causing feelings of panic or dread, typically occurring during non-REM sleep and resulting in partial awakening.