3. An invoice for goods costing P 3,500 was received and recorded as a purchase on December 31 , 2020. The related goods, shipped FOB destination, were received on January 2, 2021, and thus were not included in the physical inventory. Which of the following statements is true?
3. An invoice for goods costing P 3,500 was received and recorded as a purchase on December 31 , 2020. The related goods, shipped FOB destination, were received on January 2, 2021, and thus were not included in the physical inventory. Which of the following statements is true?
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter22: Accounting For Changes And Errors.
Section: Chapter Questions
Problem 6E: Berg Company began operations on January 1, 2019, and uses the FIFO method in costing its raw...
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Lumen INC. is preparing its 2020 year-end financial statements. Prior to any adjustments, inventory is valued at P76,050, based on a physical count. The following information has been found relating to certain inventory transactions.
3. An invoice for goods costing P 3,500 was received and recorded as a purchase on December 31 , 2020. The related goods, shipped FOB destination, were received on January 2, 2021, and
thus were not included in the physical inventory. Which of the following statements is true?
a. There is no effect on the 2015 ending inventory.
b. There is no effect on the 2015 net income.
c. The 2020 ending inventory is overstated.
d. The 2020 ending inventory is understated.
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