At the End of 2014, a $5,000 Understatement Was Discovered

question 74

Multiple Choice

At the end of 2014, a $5,000 understatement was discovered in the amount of the 2014 ending inventory as reflected in the inventory records. What were the 2014 effects of the $5,000 inventory error (before correction) ?

• A) Assets were understated by $5,000 and pretax income was understated by $5,000.
• B) Assets were understated by $5,000 and pretax income was overstated by $5,000.
• C)Cost of goods sold was understated by $5,000 and pretax income was understated by $5,000.
• D)Cost of goods sold was overstated by $5,000 and pretax income was overstated by $5,000.

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Definitions:

Disorganized-Disoriented Attachment

A type of attachment marked by inconsistent or contradictory behavior patterns in children towards their caregivers.

Dazed

Dazed describes a state of being bewildered or unable to think clearly, often resulting from shock, surprise, or a minor blow to the head.

Confused

Experiencing difficulty in understanding or making sense of something, often resulting in uncertainty or indecision.

Important Outcomes

Refers to significant results or consequences of actions or processes, particularly those with long-term effects.