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23. A company using a periodic inventory system neglected to record a purchase of merchandise on account at year-end. This merchandise was omitted from the year-end physical count. How will these errors affect inventory at year-end and cost of goods sold for the year? Cost of Goods Sold Inventory a No effect b. Understate Understate No effect Understate c. Understate d. No effect Overstate

23. A company using a periodic inventory system neglected to record a purchase of merchandise on account at year-end. This merchandise was omitted from the year-end physical count. How will these errors affect inventory at year-end and cost of goods sold for the year? Cost of Goods Sold Inventory a No effect b. Understate Understate No effect Understate c. Understate d. No effect Overstate

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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22 Goods on consignment should be included in the inventory of a. the consignor but not the consignee. b. the consignee but not the consignor. c. both the consignor and the consignee. d. neither the consignor nor the consignee. 23. A company using a periodic inventory system neglected to record a purchase of merchandise on account at year-end. This merchandise was omitted from the year-end physical count. How will these errors affect inventory at year-end and cost of goods sold for the year? Cost of Goods Sold Inventory a No effect b. Understate Understate No effect Understate Overstate c. Understate d. No effect If goods shipped FOB destination are in transit at the end of the year, they should be included in the inventory balance of the a. seller. b. common carrier. 24. с. buyer. d. bank. 25. Merchandise shipped FOB shipping point on the last day of the year should ordinarily be included in a. the buyer's inventory balance. b. the seller's inventory balance. c. neither the buyer's nor seller's inventory balance. d. both the buyer's and the seller's inventory balances. 26. The Narrows Company makes the following entry in its accounting records:
Transcribed Image Text:22 Goods on consignment should be included in the inventory of a. the consignor but not the consignee. b. the consignee but not the consignor. c. both the consignor and the consignee. d. neither the consignor nor the consignee. 23. A company using a periodic inventory system neglected to record a purchase of merchandise on account at year-end. This merchandise was omitted from the year-end physical count. How will these errors affect inventory at year-end and cost of goods sold for the year? Cost of Goods Sold Inventory a No effect b. Understate Understate No effect Understate Overstate c. Understate d. No effect If goods shipped FOB destination are in transit at the end of the year, they should be included in the inventory balance of the a. seller. b. common carrier. 24. с. buyer. d. bank. 25. Merchandise shipped FOB shipping point on the last day of the year should ordinarily be included in a. the buyer's inventory balance. b. the seller's inventory balance. c. neither the buyer's nor seller's inventory balance. d. both the buyer's and the seller's inventory balances. 26. The Narrows Company makes the following entry in its accounting records:
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