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

question 92

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 2017 financial reporting?

• A)Gross margin is overstated by $1,000.
• B)Cost of sales is overstated by $1,000.
• C)Ending inventory is understated by $1,000.
• D)Beginning inventory is overstated by $1,000.

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Definitions:

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A childbirth preparation method that emphasizes natural childbirth and strategies for coping with labor pain through breathing and relaxation techniques.

Superego

In psychoanalytic theory, the part of the personality that represents moral standards, conscience, and the ideal self.

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Being aware of and able to think about one's own existence, sensations, thoughts, and environment.

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A part of the mind that is inaccessible to the conscious mind but that affects behavior and emotions.