Inventory at the End of the Year Was Understated

question 51

Multiple Choice

Inventory at the end of the year was understated. Which of the following statements correctly states the effect of the error?

• A) net income is understated
• B) net income is overstated
• C) cost of goods sold is understated
• D) inventory reported on the balance sheet is overstated

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Definitions:

Prejudice

A preconceived opinion or judgment about someone or something that is not based on reason or actual experience, often stemming from stereotypes.

Ethnic Backgrounds

References to a person's ancestry or culture, often related to nationality, language, religion, and other social factors that demonstrate a shared communal identity.

Attractive Speaker

An individual perceived as appealing or pleasing in their manner of speaking, often influencing audience engagement and reception.

Influenced

Being affected or changed in behavior, attitude, or other aspects due to the impact of external factors.