After the issuance of its year 1 financial statements Terry, Inc. discovered a computational error of $150,000 in the calculation of its December 31, year 1 inventory. The error resulted in a $150,000 overstatement in the cost of goods sold for the year ended December 31, year 1. In October year 2, Terry paid $500,000 in settlement of litigation instituted against it during year 1. Ignore income taxes. In the year 2 financial statements the December 31, year 1 retained earnings balance, as previously reported, should be adjusted by a: a. $500,000 debit.
b. $350,000 debit.
c. $650,000 credit.
d. $150,000 credit.

University hero is considering expanding operations beyond its healthy sandwiches. jim axelrod, vice president of marketing, would like to add a line of smoothies with a similar health emphasis. each smoothie would include two free health supplements such as vitamins, antioxidants, and protein. jim believes smoothie sales should fill the slow mid-afternoon period. adding the line of smoothies would require purchasing additional freezer space, machinery, and equipment. jim provides the following projections of net sales, net income, and average total assets in support of his proposal. sandwichesonly sandwiches and smoothies net sales $ 750,000 $ 1,350,000 net income 120,000 210,000 average total assets 350,000 750,000 return on assetschoose numerator ÷ choose denominator = return on assets÷ = return on assets÷ = profit margin÷ = profit margin÷ = asset turnover÷ = asset turnover÷ = times