Use the Following Information for Question 102-103

question 153

Multiple Choice

Use the following information for question 102-103.
During its December 31, 2014 year-end inventory count, Jefferson Company failed to count items in transit to which it had legal title. As a result of this error, ending inventory was understated by $30,000.
-As a result of this error, 2014 cost of goods sold will be

• A) understated by $30,000.
• B) overstated by $30,000.
• C) correct.
• D) greater when average cost is used.

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