1. Partiol income statements for Sherwood Company summarized for a foutyear period show the
foloming: An audit fevealed that in determining these amounts, the ending inventory for 2018
was overstated by $20 , 000 . The inventory bolance on December 31, 2019, was accurately
stated. The company uses a periodic inventory system. Required: 1. Restate the partial income
statements to reflect the correct amounts, after fising the inventory crror. 2-a. hompute the gross
profit pereentage for each year (e) before the correction and (ti) after the correction. (Round your
answers to the nearest whole percent.) on December 31,2019 , was occurately stated. The
company uses a periodic inveotory system. Requlred: 1. Restate the partial income statements to
refect the correct amounts, after fixing the inventory orror. 2.a. Compute the gross prola
percentage for eoch year (a) before the correction and (o) after the correction. (Pound your
answers to the nearest whole percent.) 2.b. Do the resuits lend confidence to your corrected
amounts? Yes: No