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Peyton Dewers
on Dec 17, 2024

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The ending merchandise inventory was understated. This error would cause:

A) assets to be understated.
B) assets to be overstated.
C) net income to be overstated.
D) Cost of Goods Sold to be overstated.

Merchandise Inventory

The total cost of all the goods held by a company for resale purposes, including goods in transit, on order, and in stock.

Net Income

Net income is the total earnings or profit a company makes after deducting all its expenses, including taxes, interests, and depreciation.

  • Understand the impact of inventory errors on financial statements.
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Gaurav DodiyaDec 18, 2024
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