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

question 1

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)Cost of goods sold is understated by $1,000.
• B)Gross margin is overstated by $1,000.
• C)Ending inventory is understated by $1,000.
• D)Net income is overstated by $1,000.

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Definitions:

Function

The intended purpose or role of an object, system, or process, often related to what it does or is used for.

Amazon

An American multinational technology company primarily known for its e-commerce operations, cloud computing, digital streaming, and artificial intelligence.

Supply Chain

The entire system of producing and delivering a product or service, from the initial sourcing of materials to the final delivery to consumers.

Logistics Management

Logistics management is the part of supply chain management that plans, implements, and controls the efficient, effective forward, and reverse flow and storage of goods, services, and related information between the point of origin and the point of consumption to meet customers' requirements.