A Company Uses the Periodic Inventory Method and the Beginning $\begin{array}{ll}\text {\quad\quad Assets }&\text {\quad\quad Equity }\\\end{array}$

question 87

Multiple Choice

A company uses the periodic inventory method and the beginning inventory is overstated by $4,000 because the ending inventory in the previous period was overstated by $4,000.The amounts reflected in the current end of the period statement of financial position are
$\begin{array}{ll}\text {\quad\quad Assets }&\text {\quad\quad Equity }\\\end{array}$

• A)\(\begin{array}{ll}\text { Overstated } & \text { Overstated } \\\end{array}\)
• B)\(\begin{array}{ll}\text { Correct } & \text {\quad\quad Correct } \\\end{array}\)
• C)\(\begin{array}{ll}\text { Understated } & \text { Understated } \\\end{array}\)
• D)\(\begin{array}{ll}\text { Overstated } & \text {\quad Correct }
• \end{array}\)

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