d v lifo and correction of errors 461403

Roberts Company manufactures one product. On December 31, 2004, Roberts adopted the dollar-value LIFO inventory method. The inventory on that date using the dollar-value LIFO inventory method was $200,000. Inventory data are as follows:
Inventory at Price index
Year year-end prices (base year 2004)
2005 $205,000 1.05
2006 240,000 1.10
2007 270,000 1.23

Instructions
Compute the inventory at December 31, 2005, 2006, & 2007 using the dollar-value LIFO method for each year. (round all computations to the nearest dollar)

Part B

Martin Co. inadvertently overstates its 2005 ending inventory by $2,000 and understates its 2006 ending inventory by $5,000. Determine the effect of this error on the following accounts over the following period. State whether the account is overstated, understated or correct and by how much if over- or understated.
1. Cost of goods sold in 2005 Ac€¦Ac€¦Ac€¦Ac€¦Ac€¦Ac€¦Ac€¦Ac€¦.
2. Retained earnings at end of 2005 Ac€¦Ac€¦Ac€¦Ac€¦Ac€¦Ac€¦Ac€¦Ac€¦.
3. Net income in 2006 Ac€¦Ac€¦Ac€¦Ac€¦Ac€¦Ac€¦Ac€¦Ac€¦
4. Cost of goods sold in 2007 Ac€¦Ac€¦Ac€¦Ac€¦Ac€¦Ac€¦Ac€¦Ac€¦.
5. Retained Earnings at end of 2007 Ac€¦Ac€¦Ac€¦Ac€¦Ac€¦Ac€¦Ac€¦Ac€¦.