If Ending Inventory on December 31, 2011, Is Overstated by $60,000

question 135

Multiple Choice

If ending inventory on December 31, 2011, is overstated by $60,000, what is the effect on net income for 2012?

• A) Net income is overstated by $60,000
• B) Net income is understated by $60,000
• C) Net income is overstated by $120,000
• D) The answer cannot be determined from the information given

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