The Following Errors Were Made in 20x3: an Understatement of Purchases

question 76

Multiple Choice

The following errors were made in 20x3: an understatement of purchases of $500 and an understatement of ending inventory of $500.The net effect on the 20x3 ending amount of retained earnings is:

• A) $1,000 understatement.
• B) $1,000 overstatement.
• C) No effect, the errors offset.
• D) No effect; the errors affect income, not retained earnings.
• E) $500 understatement.

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Definitions:

Placental Stage

The third and final stage of childbirth where the placenta is delivered.

Trophoblast

The outer layer of a blastocyst, providing nutrients to the embryo and developing into a large part of the placenta.

Placenta

An organ that develops in the uterus during pregnancy to provide oxygen and nutrients to the growing baby, while removing waste products.

Primitive Streak

The primitive streak is a structure that forms on the surface of the early embryonic disc, marking the beginning of gastrulation and establishing body axes.