Latone Company Began Operations in 2014

question 45

Multiple Choice

Latone Company began operations in 2014.During the first two years of operations,Latone made undiscovered errors in taking its year-end inventories that understated 2014 ending inventory by $40,000 and overstated 2015 ending inventory by $50,000.The combined effect of these errors on reported income is 2014 2015 2016

• A) understated $40,000 overstated $50,000 not affected
• B) understated $40,000 overstated $10,000 not affected
• C) understated $40,000 overstated $90,000 understated $50,000
• D) overstated $40,000 understated $50,000 overstated $10,000

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