Redford Company hired a new store manager in October 2015, who determined the ending inventory on December 31, 2015, to be $50,000. In March, 2016, the company discovered that the December 31, 2015 ending inventory should have been $58,000. The December 31, 2016, inventory was correct. Ignore income taxes.
Required:
Complete the following table to show the effects of the inventory error on the four amounts listed. Give the amount of the discrepancy and indicate whether it was overstated (O), understated (U), or had no effect (N). 
Definitions:
Profit-Maximizing Climate
An environment in business operations where the primary focus is on increasing profits to the highest possible level.
Conventional Morality
A stage in Kohlberg's theory of moral development where individuals make ethical decisions based on societal laws and the approval of others.
Aesthetic Person
An individual who appreciates and is sensitive to beauty in art, nature, and everyday life.
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