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Navajo Company’s financial statements show the following. Thecompany recently discovered that in making physical counts ofinventory, it had made the following errors: Inventory on December31, 2016, is understated by $56,000, and inventory on December 31,2017, is overstated by $26,000.

For Year Ended December 31		2016		2017		2018
(a)	Cost of goods sold	$	731,000	$	961,000	$	796,000
(b)	Net income		274,000		281,000		256,000
(c)	Total current assets		1,253,000		1,366,000		1,236,000
(d)	Total equity		1,393,000		1,586,000		1,251,000

1. For each key financial statement figure—(a),(b), (c), and (d) below—prepare a tableto show the adjustments necessary to correct the reported amounts.(Amounts to be deducted must be entered with a minus sign.)

2016 2017 2018 Cost of goods sold: Reported amount $731,000 $961,000 $796,000 Adjustments for: 12/31/2016 error 12/31/2017 error Corrected amount $731,000 $961,000 $796,000 Net income: Reported amount $274,000 $281,000 $256,000 Adjustments for: 12/31/2016 error 12/31/2017 error Corrected amount $274,000 $281,000 $256,000 Total current assets: Reported amount $1,253,000 $1,366,000 $1,236,000 Adjustments for: 12/31/2016 error 12/31/2017 error Corrected amount $1,253,000 $1,366,000 $1,236,000 Equity: Reported amount $1,393,000 $1,586,000 $1,251,000 Adjustments for: 12/31/2016 error 12/31/2017 error Corrected amount $1,393,000 $1,586,000 $1,251,000

2. What is the error in total net income forthe combined three-year period resulting from the inventoryerrors?