The Ending Merchandise Inventory for the Current Year Is Overstated

question 103

Multiple Choice

The ending merchandise inventory for the current year is overstated by $20,000.What effect will this error have on the following year's Net Income?

• A)The net income will be overstated by $40,000.
• B)The net income will be overstated by $20,000.
• C)The net income will be understated by $20,000.
• D)The net income will be understated by $40,000.

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Definitions:

Fantasy

An imaginative or fanciful thought, not grounded in reality, often serving as a mental escape from mundane or stressful scenarios.

I.Q.

Short for Intelligence Quotient, a measure of a person's intellectual abilities relative to their age group.

Brain Waves

The patterns of electrical activity in the brain, measured by EEG, that are indicative of different states of consciousness.

Volts

The unit of electric potential and electromotive force in the International System of Units, symbolized as V.