The net income of Freetown Limited for the years 2015 and 2016 were computed as...
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The net income of Freetown Limited for the years 2015 and 2016 were computed as $315,000 and $205,000, respectively. An audit of the financial statement early in 2017 revealed the following errors: a) The closing stock for 2015 was understated by $24,000 and closing stock for 2016 overstated by $8,950. b) Insurance paid in 2015 for 2016 of $7,490 was charged in error as an expense in 2015. c) During the year 2015 rent received was for 15 months, 3 months related to 2016 but no adjustments were made for the sum received of $8,550. REQUIRED: Determine the correct net income figures for 2015 and 2016
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