A Purchase on Credit Is Recorded Twice and Not Corrected

question 37

Multiple Choice

A purchase on credit is recorded twice and not corrected during the physical inventory.Which of the following statements correctly describes the impact of this error?

• A)The current year income on the income statement is correct because purchases are overstated and ending inventory is overstated.
• B)The current year balance sheet ending inventory and accounts payable are understated.
• C)The succeeding year income on the income statement is incorrect because beginning inventory is understated.
• D)The succeeding year purchases are understated when the prior year purchases are corrected.

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Definitions:

Pubic Area

The region of the human body located in the lower abdomen, above the genitals, where pubic hair grows after puberty.

Coronary Artery

The artery that supplies blood to the heart muscle, essential for its function and health.

Therapeutic

Pertaining to the treatment of disease and the healing process, often used in the context of procedures, environments, and relationships that aim to restore health.

Uncircumcised

Referring to an individual who has not undergone circumcision, retaining the foreskin covering the head of the penis.