A Company Fails to Record One Storeroom Full of Inventory

Multiple Choice

A company fails to record one storeroom full of inventory in its year-end inventory records.As a result, this will cause:

A) an overstatement of cost of goods sold for the current year.
B) an overstatement of inventory on the year-end balance sheet.
C) an overstatement of retained earnings at the end of the year.
D) an understatement of gross profit in the following year.