Coombs, Inc

question 14

Multiple Choice

Coombs, Inc. is a calendar-year corporation whose financial statements for 2010 and 2011 included errors as follows:

Assume that purchases were recorded correctly and that no correcting entries were made at December 31, 2010, or December 31, 2011. Ignoring income taxes, by how much should Coombs's retained earnings be retroactively adjusted at January 1, 2012?

• A) $27,000 increase
• B) $27,000 decrease
• C) $7,000 decrease
• D) $3,000 decrease

---

Definitions:

Crimes Per Capita

A statistical measure expressing the number of crimes reported per unit of population in a given area or period.

Variance

A measure of the dispersion or spread of a set of data points around their mean; it quantifies the degree to which these points differ from the mean.

Original Data

The initial dataset collected or received before any processing, manipulation, or analysis has been done.

Independent Events

Events whose occurrence or outcome is not influenced by the occurrence or outcome of another event.