Randwick Plc Has a Year-End of 30 June 2011 B)

question 7

Multiple Choice

Randwick Plc has a year-end of 30 June 2011.During the year the following errors were discovered. - Merchandise inventory at the factory had been understated by €44 000.
- Goods on consignment from a supplier for €13 000 were included in inventory at the shops.
- Physical inventory for one warehouse had a shortage of €58 000.
What is the net effect of above errors in the statement of comprehensive income and statement of financial position (inventory) accounts of Randwick Plc?

• A) \[\begin{array} { | c | c | }
• \hline \begin{array} { c }
• \text { Statement of } \\
• \text { comprehensive income }
• \end{array} & \begin{array} { c }
• \text { Statement of financial } \\
• \text { position (inventory) }
• \end{array} \\
• \hline \text { Increase } & \text { Increase } \\
• \hline
• \end{array}\]
• B) \[\begin{array} { | c | c | }
• \hline \begin{array} { c }
• \text { Statement of } \\
• \text { comprehensive income }
• \end{array} & \begin{array} { c }
• \text { Statement of financial } \\
• \text { position (inventory) }
• \end{array} \\
• \hline \text { Decrease } & \text { Increase } \\
• \hline
• \end{array}\]
• C) \[\begin{array} { | c | c | }
• \hline \begin{array} { c }
• \text { Statement of } \\
• \text { comprehensive income }
• \end{array} & \begin{array} { c }
• \text { Statement of financial } \\
• \text { position (inventory) }
• \end{array} \\
• \hline \text { Decrease } & \text { Decrease } \\
• \hline
• \end{array}\]
• D) \[\begin{array} { | c | c | }
• \hline \begin{array} { c }
• \text { Statement of } \\
• \text { comprehensive income }
• \end{array} & \begin{array} { c }
• \text { Statement of financial } \\
• \text { position (inventory) }
• \end{array} \\
• \hline \text { Increase } & \text { Decrease } \\
• \hline
• \end{array}\]

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Definitions:

Milgram Experiment

A psychological experiment conducted by Stanley Milgram in the 1960s to study obedience to authority, where participants were instructed to administer electric shocks to another person.

Stanford University Prison Experiment

A psychological study conducted by Philip Zimbardo in 1971 at Stanford University, where students were assigned roles of prisoners and guards to explore the effects of perceived power.

Generalization

Drawing a conclusion about a certain characteristic of a population based on a sample from it.

Logical Support

The provision of reasons or evidence to justify a claim or argument.