Sinclair, Inc

question 86

Short Answer

Sinclair, Inc. uses the perpetual inventory system. The company's management, under pressure to report favorable results to shareholders, counted $15,000 of inventory that had already been sold at year-end. Compared to an accurate inventory count, what is the effect of counting this inventory on the financial statements?

---

Definitions:

Appraisal Instruments

Tools or methods used to evaluate an employee's performance, skills, and productivity, typically for the purpose of making decisions about promotions, pay raises, and development.

Standardized Job-Analysis

A methodical process for determining the tasks, skills, knowledge, and abilities required for a job using consistent procedures.

Position Analysis Questionnaire

A standardized job analysis instrument that evaluates a job's duties and requirements by using a series of structured questions.

Database

A structured collection of data stored in a computer system, allowing for easy access, management, and updating of the data.