Use the Following Information for Questions

question 20

Multiple Choice

Use the following information for questions
At Iserlohn Company, events and transactions during 2011 included the following.The tax rate for all items is 30 percent.
(1) Amortization for 2009 was found to be understated by $30,000.
(2) A strike by the employees of a supplier resulted in a loss of $20,000.(3) The inventory at December 31, 2009 was overstated by $40,000.
(4) A flood destroyed a building that had a book value of $400,000.Floods are very uncommon in that area.
-The effect of these events and transactions on the beginning balance of 2011 retained earnings would be

• A)$14,000.
• B)$294,000.
• C)$21,000.
• D)$343,000.

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Definitions:

Business Proposition

A value statement explaining what benefits a company offers, how it solves customer problems, and why it is unique or better than competitors.

End-User

The final consumer of a product or service who uses it for its intended purpose.

ROI

Return on Investment, a financial metric used to evaluate the efficiency and profitability of an investment, calculated by dividing the net profit by the initial cost.

Marketing Plan

A strategic document outlining an organization's advertising and marketing efforts over a certain period of time.