Multiple Choice
Match each situation to its impact (a-c) on the current year's net income.
-Purchased merchandise was shipped FOB shipping point on the last day of the year. The cost of the merchandise was not included in ending inventory.
A) Net income for the current year will be overstated.
B) Net income for the current year will be understated.
C) There will be no error effect on net income.
Correct Answer:
Verified
Correct Answer:
Verified
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