If Cost of Goods Sold Is Understated by $6,000 for This

question 79

Multiple Choice

If cost of goods sold is understated by $6,000 for this year,what effect will this have on income before income taxes in the following year?

• A)understated by $3,000
• B)overstated by $6,000
• C)understated by $6,000
• D)no effect

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Definitions:

Commodities

Basic goods used in commerce that are interchangeable with other goods of the same type.

Carriers

Companies or individuals that undertake the transportation of goods or passengers.

Long Logistical Distance

Long logistical distance indicates the extended physical space or geographical span that logistics and supply chain processes must cover, potentially influencing transport time and costs.

Package Carrier

A company or service that specializes in the transportation and delivery of parcels and documents.