Question

Bramble Enterprises reported cost of goods sold for 2020 of $1,474,700 and retained earnings of $5,621,900...

Bramble Enterprises reported cost of goods sold for 2020 of $1,474,700 and retained earnings of $5,621,900 at December 31, 2020. Bramble later discovered that its ending inventories at December 31, 2019 and 2020, were overstated by $109,760 and $36,670, respectively. Determine the corrected amounts for 2020 cost of goods sold and December 31, 2020, retained earnings. Corrected cost of goods sold $enter a dollar amount Corrected 12/31/20 retained earnings $enter a dollar amount

Homework Answers

Answer #1
Calculation of Correct Cost of Goods Sold
Cost of goods sold reported overstated ending 1,474,700
Overstated ending Inventory of 2020 36,670
Overstated ending inventory of 2019 -109,760
Correct cost of goods sold $1,401,610

Calculation of Correct Retained earnings
Retained earnings reported 5,621,900
Overstated ending Inventory of 2020 -36,670
Overstated ending inventory of 2019 109,760
Correct retained earnings $5,694,990

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