Cornwall Co made the following errors in counting its year-end physical inventories: 2012 ................................... $ 60,000 overstatement 2013 ................................... 108,000 understatement 2014 ................................... 90,000 overstatement The entry to correct the accounts at the end of 2014 is
a. Retained Earnings ................... 48,000
Cost of Goods Sold .................. 42,000
Inventory ........................ 90,000
b. Retained Earnings ................... 18,000
Cost of Goods Sold .................. 72,000
Inventory ........................ 90,000
c. Inventory .......................... 90,000
Cost of Goods Sold ............... 18,000
Retained Earnings ............... 72,000
d. Cost of Goods Sold .................. 198,000
Retained Earnings ................ 108,000
Inventory ........................ 90,000
D
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