The Physical Count of Inventory Was Incorrect Which Overstated the Ending

question 42

Multiple Choice

The physical count of inventory was incorrect which overstated the ending inventory. This would cause

• A) Cost of Goods Sold to be overstated.
• B) Cost of Goods Sold to be understated.
• C) gross profit to be understated.
• D) net income to be understated.

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Definitions:

Income Quintiles

A statistical measure dividing a population into five equal groups according to their income level for comparative analysis.

Government Spending

Expenditures by the government sector on goods and services that it consumes to provide public services and for the benefit of the community.

Personal Income Tax

Tax levied on individuals or households based on their total income from all sources.

Corporate Income Tax

A tax imposed on the net income or profit of corporations and other business entities by the government.