The Following Errors Were Made in 20x3: an Understatement of Purchases

question 56

Multiple Choice

The following errors were made in 20x3: an understatement of purchases of $500 and an understatement of ending inventory of $500.The net effect on the 20x3 ending amount of retained earnings is:

• A)$500 understatement.
• B)No effect, the errors offset.
• C)$1,000 understatement.
• D)No effect; the errors affect income, not retained earnings.
• E)$1,000 overstatement.

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Definitions:

Locally Responsive

An approach or strategy where a company adjusts its products, services, and practices to better align with local buyer preferences and market conditions.

Knowledge Transfer

The process through which skills, knowledge, technologies, or methodologies are passed from one individual or organization to another.

Transnational Strategy

A global business approach that involves operating in multiple countries with a coordinated strategy, balancing global efficiency and local responsiveness.

Locally Responsive

Being locally responsive refers to a business strategy that involves tailoring products, services, and operations to meet the cultural, legal, and consumer preferences of local markets.