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

question 138

Multiple Choice

Assume that a purchase invoice for $1,000 was appropriately recorded in fiscal 2019, but the inventory was excluded in error during the ending inventory count. What impact will this have on fiscal 2020 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:

Job Context

The work environment and all the conditions, including tasks and responsibilities, that influence one's job.

Motivating Potential Score

A numeric index used to predict job satisfaction and motivation potential, based on the design of a job and five core job characteristics.

Growth Need Strength

The degree to which an individual requires personal growth and development within their job.

Task Significance

The degree to which a job has a substantial impact on the lives of other people, within or outside the organization.