Elizabeth Company Discovered the Following Errors in 2010: Ending Inventory $\$ 2,000$

question 42

Multiple Choice

Elizabeth Company discovered the following errors in 2010: Ending inventory at December 31,2009 , was understated by $\$ 2,000$ .
Accrued expenses of $\$ 3,000$ were not recorded at December 31,2009 Elizabeth reported net income of $35, 000 for the year 2009.The corrected net income (ignoring income taxes) for 2009 should be

• A)$40, 000
• B)$30, 000
• C)$36, 000
• D)$34, 000

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Definitions:

Res Ipsa Loquitur

A legal doctrine that infers negligence from the very nature of an accident or injury in the absence of direct evidence on how any defendant behaved.

Finding of Negligence

A determination in law that an individual or organization failed to act with care, resulting in harm to another party.

Last-Clear-Chance Doctrine

A doctrine used by a plaintiff when the defendant establishes contributory negligence. If the plaintiff can establish that the defendant had the last opportunity to avoid the accident, the plaintiff may still recover, despite being contributorily negligent.

Contributory Negligence

A legal doctrine indicating that if a party has contributed to their own injury or damages through their negligence, they may not be compensated for those injuries or damages.