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14. Speers hardware store prepared the following analysis of cost of goods sold for the...

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Accounting

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14. Speers hardware store prepared the following analysis of cost of goods sold for the previous Beginning inventory 1/1 2016 2017 2018 Cost of goods purchased 40,000 18,000 25,000 50,000 55,000 70,000 Cost of goods available for sale 90,000 73,000 95,000 Ending inventory 12/31 18,000 25,000 40,000 Cost of goods sold 72,000 48,000 55,000 Net income for the years 2016, 2017, and 2018 was 70,000 60,000, and 65,000, respectively. Since net income was consistently declining, Mr. Speer hired a new accountant to investigate the cause(s) for the declines. The accountant determined the following: 1. Purchases of 20,000 were not recorded in 2016. 2. The 2016 December 31 inventory should have been 21,000. 3. The 2017 ending inventory included inventory costing 8,000 that was purchased FOB destination and in transit at year end. 4. The 2018 ending inventory did not include goods costing 4,000 that were shipped on December 29 to Sampson Plumbing Company, FOB shipping point. The goods were still in transit at the end of the year. Instructions Determine the correct net income for each year. (Show all computations.) (9%)

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