An Overstatement of Ending Inventory in One Period Results in

question 81

Multiple Choice

An overstatement of ending inventory in one period results in

• A)no effect on profit of the next period.
• B)an overstatement of profit of the next period.
• C)an understatement of profit of the next period.
• D)an overstatement of the ending inventory of the next period.

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Definitions:

Financial Statements

Compiled reports that summarize a company's financial status, including the balance sheet, income statement, and cash flow statement.

Percentage Change

A mathematical calculation that illustrates how much a value has changed as a proportion of its previous value.

Horizontal Analysis

A financial analysis method that compares historical financial data over a series of periods to identify trends and growth patterns.

Increase Or Decrease

Terms that refer to the change in size, amount, or number of something, often used to describe financial and numerical data fluctuations.