If in the Current Year a Purchase Was Not Recorded

question 108

Multiple Choice

If in the current year a purchase was not recorded but the purchased item was included in ending physical inventory, which one of the following situations occurs for the current year?

• A)Working capital is understated, and net income is overstated.
• B)Working capital and net income are understated.
• C)Working capital is overstated, and net income is understated.
• D)Working capital and net income are overstated.

---

Definitions:

Sieve Tube Elements

Specialized cells in the phloem of vascular plants that are responsible for transporting sugars and other metabolic products downwards from the leaves.

Active Transport

The movement of molecules across cell membranes against their concentration gradient, requiring energy typically in the form of ATP.

Herbaceous Eudicot

A group of flowering plants that are characterized by having two cotyledons, or seed leaves, and typically have non-woody, soft stems.

Monocot

A group of flowering plants whose seeds typically contain one embryonic leaf, known for having parallel leaf veins and various other structural differences from dicots.