If ending inventory is understated by $25,000, what effect will this have on cost of goods sold and net income? a.Cost of goods sold is overstated by $25,000, and net income is understated by $25,000. b.Cost of goods sold is understated by $25,000, and net income is understated by $25,000. c.Cost of goods sold is understated by $25,000, and net income is overstated by $25,000. d.Cost of goods sold is overstated by $25,000, and net income is overstated by $25,000.
If ending inventory is understated by $25,000, what effect will this have on cost of goods sold and net income? a.Cost of goods sold is overstated by $25,000, and net income is understated by $25,000. b.Cost of goods sold is understated by $25,000, and net income is understated by $25,000. c.Cost of goods sold is understated by $25,000, and net income is overstated by $25,000. d.Cost of goods sold is overstated by $25,000, and net income is overstated by $25,000.
Chapter10: Inventory
Section: Chapter Questions
Problem 14PB: Assuming a companys year-end inventory were understated by $16,000, indicate the effect...
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If ending inventory is understated by $25,000, what effect will this have on cost of goods sold and net income?
a.Cost of goods sold is overstated by $25,000, and net income is understated by $25,000.
b.Cost of goods sold is understated by $25,000, and net income is understated by $25,000.
c.Cost of goods sold is understated by $25,000, and net income is overstated by $25,000.
d.Cost of goods sold is overstated by $25,000, and net income is overstated by $25,000.
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