If Period 1 Ending Inventory Is Overstated, Then

question 15

Multiple Choice

If Period 1 ending inventory is overstated, then:

• A)both cost of goods sold and net income are understated in Period 1.
• B)cost of goods sold is overstated and net income is understated in Period 1.
• C)cost of goods sold is understated and net income is overstated in Period 1.
• D)both cost of goods sold and net income are overstated in Period 1.

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Definitions:

Cap Monetary Damages

The practice of setting a maximum limit on the amount of money that can be awarded to a plaintiff in a lawsuit for damages.

Civil Cases

Legal disputes between two or more parties wherein compensation or specific performance is sought rather than criminal sanctions.

Negligence Per Se Doctrine

is a legal principle where an act is considered negligent because it violates a statute or regulation.

Local Ordinance

A law or regulation enacted by a municipal or county government specific to the area under its jurisdiction.