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

question 8

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 understated by $1,000.
• B)No effect on cost of goods available for sale.
• C)Cost of sales is understated by $1,000.
• D)Beginning inventory is overstated by $1,000.

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Definitions:

Parietal Lobe

The region of the brain located at the top of the head, responsible for processing sensory information regarding the location of parts of the body.

Motor Cortex

The region of the cerebral cortex involved in the planning, control, and execution of voluntary movements.

Frontal Lobe

The part of the cerebral cortex that lies at the front of the brain and is involved in complex cognitive functions, including decision making, planning, and controlling social behavior.

Medulla

The innermost part of an organ or structure, especially the medulla oblongata part of the brainstem controlling vital bodily functions.