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P6-12B The financial records of Sketch Drawing and Home Plans show these data (in thousands): 2019 2018 $345 $320 $ 41 2020 Net sales revenue $410 Cost of goods sold Beginning inventory $ 49 Net purchases 146 Cost of goods available for sale 195 Less: Ending inventory 52 Cost of goods sold 143 Gross margin 267 Operating expenses 109 Net income $158 101 142 $ 52 98 150 41 49 93 252 102 $150 109 211 74 $137 In early 2021, a potential investor's auditors discovered that the ending inventory of 2018 had been overstated by $5,000. Also, the ending inventory for 2020 had been understated by $7,000. The ending inventory at December 31, 2019, was correct. Required 145 y3 TUY 267 252 211 COST U gouus SOIU Gross margin Operating expenses Net income 109 102 74 $158 $150 $137 In early 2021, a potential investor's auditors discovered that the ending inventory of 2018 had been overstated by $5,000. Also, the ending inventory for 2020 had been understated by $7,000. The ending inventory at December 31, 2019, was correct. Required 1. Show corrected comparative income statements for the three years. 2. State whether each year's net income as reported here and the related owner's equity amounts are understated or overstated. For each incorrect figure, indicate the amount of the understatement or overstatement

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