Question

g Georgia Company reported total assets of $6,400,000 and net income of $510,000 for the current year. Risers determined that inventory was understated by $138,000 at the beginning of the year and $60,000 at the end of the year. What is the corrected amount for total assets and net income for the year

Answer 1

Answer:the corrected amount for total assets and net income for the year is $6,460,000 and $432, 000 respectively.

Step-by-step explanation:

Georgia Company reported

total assets= $6,400,000

net income of $510,000 for the Current year

Inventory at the beginning of the year= $138,000

Inventory at the end of the year= $60,000

The corrected amount for the total assets is as follows

= Reported total assets + Inventory at the end of the year

= $6,400,000+$60,000

= $6,460,000

The corrected amount for the net income is as follows

=Net income of current year - Inventory at the beginning of the year + Inventory at the end of the year

= $510,000 -$138,000 +$60,000

=$432, 000

Hence the corrected amount for total assets and net income for the year is $6,460,000 and $432, 000 respectively.