Multiple Choice
At the end of 2019,a $5,000 understatement was discovered in the 2019 ending inventory as reflected in the inventory records.What were the 2019 effects of the $5,000 inventory error (before correction) ?
A) Assets were understated by $5,000 and pretax income was understated by $5,000.
B) Assets were understated by $5,000 and pretax income was overstated by $5,000.
C) Cost of goods sold was understated by $5,000 and pretax income was understated by $5,000.
D) Cost of goods sold was overstated by $5,000 and pretax income was overstated by $5,000.
Correct Answer:
Verified
Correct Answer:
Verified
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