Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. vibrant company had $900,000 of sales in each of y

Vibrant Company had $900,000 of sales in each of Year 1, Year 2, and Year...

60.1K

Verified Solution

Question

Accounting

Vibrant Company had $900,000 of sales in each of Year 1, Year 2, and Year 3, and it purchased merchandise
costing $500,000 in each of those years. It also maintained a $200,000 physical inventory from the beginning to
the end of that three-year period. In accounting for inventory, it made an error at the end of Year 1 that caused its
Year 1 ending inventory to appear on its statements as $180,000 rather than the correct $200,000.
Determine the correct amount of the company's gross profit in each of Year 1, Year 2, and Year 3.
Prepare comparative income statements to show the effect of this error on the company's cost of goods sold
and gross profit for each of Year 1, Year 2, and Year 3.
image

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students