The Community Store Reported the Following Amounts on Their Financial $\quad$

question 40

Essay

The Community Store reported the following amounts on their financial statements for Year 1,Year 2,and Year 3:
$\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$$\begin{array} { c } \text { For the year ended } \\\text { December 31 }\end{array}$
$\begin{array} { | l | r | r | r | } \hline & \text { Year 1 } & \text { Year 2 } & \text { Year 3 } \\\hline \text { Cost of goods sold } & \$ 75,000 & \$ 87,000 & \$ 77,000 \\\hline \text { Net income } & 22,000 & 25,000 & 21,000 \\\hline \text { Total current assets } & 155,000 & 165,000 & 110,000 \\\hline \text { Equity } & 287,000 & 295,000 & 304,000 \\\hline\end{array}$
It was discovered early in Year 4 that the ending inventory on December 31,Year 1 was overstated by $6,000,and the ending inventory on December 31,Year 2 was understated by $2,500.The ending inventory on December 31,Year 3 was correct.Ignoring income taxes determine the correct amounts of cost of goods sold,net income,total current assets,and equity for each of the years Year 1,Year 2,and Year 3.

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