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Unformatted text preview: 3,000 Requirement 3 The financial statements that were incorrect as a result of both errors (effect of one error in 2004 and effect of three errors in 2005) would be retrospectively restated to report the correct inventory amounts, cost of goods sold, income, and retained earnings when those statements are reported again for comparative purposes in the 2006 annual report. A “prior period adjustment” to retained earnings would be reported, and a disclosure note should describe the nature of the error and the impact of its correction on each year’s net income, income before extraordinary items, and earnings per share....
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This note was uploaded on 11/16/2009 for the course ACCOUNTING 3351 taught by Professor Malkie during the Spring '09 term at ITT Tech Flint.
- Spring '09
- Financial Accounting