Compute the corrected net income figure for each of the four years for the Red Bliss Company after…

This exercise will enable you to practice identifying the effects of inventory errors on the financial statements.

The net income per books was determined without knowledge of the errors indicated.

Year

Net Income
Per Books

Error in Ending Inventory

2011

$100.000

Overstated

$6.000

2012

104.000

Overstated

14.000

2013

108,000

Understated

22,000

2014

112.000

No error

Total

$424,000

Instructions

Compute the corrected net income figure for each of the four years for the Red Bliss Company after taking into account the inventory errors.

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