Examlex

Solved

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

question 67

Essay

Dows Company prepared income statements that reflected pretax income of $21,000 for 2015 and $30,000 for 2016. An audit has determined that there were two errors in the inventory amounts as follows:
Amount Reported
Correct Amount
Ending inventory, 2015
$15,000
$14,000
Ending inventory, 2016
18,000
16,000
Required:
Determine the correct pretax income amount for each year (show computations; assume the errors were not corrected):


Definitions:

F Test

A statistical test used to determine if there are significant differences between the variances of two or more groups.

Mustang Population

Refers to the total number of Mustang horses (a type of free-roaming horse of the American west) existing within a specific area or globally.

Sums of Squares

A statistical technique used to describe the total variation or dispersion of a set of data points around their mean.

ANOVA Table

A table that summarizes the output and relevant statistical tests of an analysis of variance, which compares means among groups.

Related Questions