A Purchase on Credit Is Recorded Twice and Not Corrected

question 37

Multiple Choice

A purchase on credit is recorded twice and not corrected during the physical inventory.Which of the following statements correctly describes the impact of this error?

• A)The current year income on the income statement is correct because purchases are overstated and ending inventory is overstated.
• B)The current year balance sheet ending inventory and accounts payable are understated.
• C)The succeeding year income on the income statement is incorrect because beginning inventory is understated.
• D)The succeeding year purchases are understated when the prior year purchases are corrected.

---

Definitions:

Ladder Rung

Another term for a level or step in ladder logic programming, where conditions and outputs are structured in a manner resembling rungs on a ladder.

Input Instructions

Commands or codes in a program that are used to read and process data from external sources.

Output Instruction

A command in programming or PLC operations that controls the output of data or signals to external devices.

Motor Start

Motor start refers to the process or the set of actions initiated to begin the operation of an electric motor. This can involve mechanisms like direct on-line starters or soft starters to manage electrical load and torque.