If the Beginning Inventory for 2015 Is Overstated, the Effects

question 53

Multiple Choice

If the beginning inventory for 2015 is overstated, the effects of this error on cost of goods sold for 2015, net income for 2015, and assets at December 31, 2016, respectively, are

• A)overstatement, understatement, overstatement.
• B)overstatement, understatement, no effect.
• C)understatement, overstatement, overstatement.
• D)understatement, overstatement, no effect.

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Definitions:

Scientific Theories

Well-substantiated explanations of natural phenomena, derived from methodological research, observation, and experimentation, capable of predicting future occurrences.

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A Russian painter and art theorist, considered one of the pioneers of abstract art in the early 20th century.

Abstraction

The process of thought in which ideas are distanced from objects.

Franz Marc

A German painter and printmaker, one of the key figures of the German Expressionist movement.