Galena Pharmacy reported cost of goods sold as follows: 2016 ‾ 2017 ‾ Beginning inventory 54 , 000 $ 64 , 000 Cost of goods purchased 847 , 000 ‾ 891 , 000 ‾ Cost of goods available for sale 901 , 000 955 , 000 Ending inventory 64 , 000 ‾ 55 , 000 ‾ Cost of goods sold $ 837 , 000 ‾ $ 900 , 000 ‾ \begin{array}{lcc} & \underline{2016} & \underline{2017}\ ext {Beginning inventory} & 54,000 & \$ 64,000 \ ext {Cost of goods purchased} & \underline{847,000} & \underline{891,000} \ ext {Cost of goods available for sale} & 901,000 & 955, 000 \ ext {Ending inventory} & \underline{ 64,000} & \underline{55,000 }\ ext {Cost of goods sold} & \underline{ \$ 837,000} & \underline{ \$ 900,000}\end{array} Beginning inventory Cost of goods purchased Cost of goods available for sale Ending inventory Cost of goods sold 2016 54 , 000 847 , 000 901 , 000 64 , 000 $837 , 000 2017 $64 , 000 891 , 000 955 , 000 55 , 000 $900 , 000 Jim Holt the bookkeeper made two errors:(1) 2016 ending inventory was overstated by $7000.(2) 2017 ending inventory was understated by $16000.InstructionsAssuming the errors had not been corrected indicate the dollar effect that the errors had on the items appearing on the financial statements listed below. Also indicate if the amounts are overstated (O) or understated (U). 11eb1392_1bf1_b3a7_8021_79c4e89749fb

Question

Galena Pharmacy reported cost of goods sold as follows:   2016 ‾ 2017 ‾ Beginning inventory 54 , 000 $ 64 , 000 Cost of goods purchased 847 , 000 ‾ 891 , 000 ‾ Cost of goods available for sale 901 , 000 955 , 000 Ending inventory 64 , 000 ‾ 55 , 000 ‾ Cost of goods sold $ 837 , 000 ‾ $ 900 , 000 ‾ \begin{array}{lcc} &  \underline{2016} &  \underline{2017}\	ext {Beginning inventory} & 54,000  &  \$ 64,000 \	ext {Cost of goods purchased} &  \underline{847,000}  &  \underline{891,000} \	ext {Cost of goods available for sale} & 901,000  &  955, 000 \	ext {Ending inventory} &  \underline{ 64,000}  &   \underline{55,000 }\	ext {Cost of goods sold} &  \underline{ \$ 837,000}  &  \underline{ \$ 900,000}\end{array} Beginning inventory Cost of goods purchased Cost of goods available for sale Ending inventory Cost of goods sold ​ 2016 ​ 54 , 000 847 , 000 ​ 901 , 000 64 , 000 ​ $837 , 000 ​ ​ 2017 ​ $64 , 000 891 , 000 ​ 955 , 000 55 , 000 ​ $900 , 000 ​ ​ Jim Holt the bookkeeper made two errors:(1) 2016 ending inventory was overstated by $7000.(2) 2017 ending inventory was understated by $16000.InstructionsAssuming the errors had not been corrected indicate the dollar effect that the errors had on the items appearing on the financial statements listed below. Also indicate if the amounts are overstated (O) or understated (U). 11eb1392_1bf1_b3a7_8021_79c4e89749fb

Allison Perez · Accepted Answer

Final Answer :       Correct cost of goods sold:  	ext { Correct cost of goods sold: }  Correct cost of goods sold:  2014 ‾ 2015 ‾ Beginning inventory 54 , 000 $ 57 , 000 Cost of goods purchased 847 , 000 ‾ 891 , 000 ‾ Cost of goods available for sale 901 , 000 948 , 000 Ending inventory 57 , 000 ‾ 71 , 000 ‾ Cost of goods sold $ 844 , 000 ‾ $ 877 , 000 ‾ \begin{array}{lcc} &  \underline{2014} &  \underline{2015}\	ext {Beginning inventory} & 54,000  &  \$57,000 \	ext {Cost of goods purchased} &  \underline{847,000}  &  \underline{891,000} \	ext {Cost of goods available for sale} & 901,000  &  948, 000 \	ext {Ending inventory} &  \underline{ 57,000}  &   \underline{71,000 }\	ext {Cost of goods sold} &  \underline{ \$ 844,000}  &  \underline{ \$877,000}\end{array} Beginning inventory Cost of goods purchased Cost of goods available for sale Ending inventory Cost of goods sold ​ 2014 ​ 54 , 000 847 , 000 ​ 901 , 000 57 , 000 ​ $844 , 000 ​ ​ 2015 ​ $57 , 000 891 , 000 ​ 948 , 000 71 , 000 ​ $877 , 000 ​ ​

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