Question

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The December 31, 2021, inventory of Tog Company, based on a physical count, was determined to be $452,000. Included in that count was a shipment of goods received from a supplier at the end of the month that cost $52,000. The purchase was recorded paid for in 2022. Another supplier shipment costing $21,000 was correctly recorded as a purchase in 2021. However, the merchandise, shipped FOB shipping point, was not received until 2022 and was incorrectly omitted from the physical count. A thi purchase, shipped from a supplier FOB shipping point on December 28, 2021, did not arrive until January 3, 2022. The merchandi which cost $82,000, was not included in the physical count and the purchase has not yet been recorded The company uses a periodic inventory system Required: 1. Determine the correct December 31, 2021, inventory balance and, assuming that the errors were discovered after the 2021 financi statements were issued, analyze the effect of the errors on 2021 cost of goods sold, net income, and retained earnings (Ignore income taxes) 2. Prepare a journal entry to correct the errors Answer is not complete. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare a journal entry to correct the errors. (If no entry is required for a transaction/event, select "No journal entry required in the first account field.) No Transaction General Journal Inventory Credit Retained earnings Cost of goods sold Debit 103.000 31,000 14 000

Answer 1

Inventory	103000	Dr.
Retained earnings	31,000	Dr.
	To	Trade payables	82000
	To	Cost of goods sold	52,000

Since, Purchase transaction of 82,000 was yet to be recorded , the same will lead to crediting the trade payable account as the amount is yet to be recorded as due for payment, rest of the answer posted is correct