Assume That a Purchase Invoice for $1,000 Was Appropriately Recorded

question 60

Multiple Choice

Assume that a purchase invoice for $1,000 was appropriately recorded in fiscal 2016,but the inventory was excluded in error during the ending inventory count.What impact will this have on fiscal 2016 financial reporting?

• A)Gross margin is overstated.
• B)Cost of sales is overstated by $1,000.
• C)Ending inventory is overstated by $1,000.
• D)Cost of goods available for sale is overstated by $1,000.

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Definitions:

Referent Power

The ability to influence others based on their admiration, respect, or desire to identify with the person possessing this power.

Positional Power

The authority and power vested in an individual’s role or position within an organization's hierarchy.

Knowledgeable

Having or showing understanding, awareness, or familiarity with facts, information, or skills through experience or education.

Leadership And Power

The relationship between the ability to influence others and the capacity to use this influence to direct and motivate their actions towards achieving goals.