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Assuming a periodic inventory system, how would Sue's cost of goods sold, gross profit, and net income be affected in 2020 by these errors?

Assuming a periodic inventory system, how would Sue's cost of goods sold, gross profit, and net income be affected in 2020 by these errors?

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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The accountant for Suzanne Company made the following errors related to inventory in 2020: The beginning inventory for 2020 was overstated by $1,375 due to an error in the physical count. A $1,650 purchase of merchandise on credit in 2020 was not recorded or included in the ending Inventory. 1. 2. Assuming a periodic inventory system, how would Sue's cost of goods sold, gross profit, and net income be affected in 2020 by these errors? Cost of Goods Sold Net Income Understated Overstated Overstated Understated No effect Overstated No effect No effect Set 1. 11. III. IV. Set II Set IV Set III O set I Gross Profit Understated Understated Overstated No effect
Transcribed Image Text:The accountant for Suzanne Company made the following errors related to inventory in 2020: The beginning inventory for 2020 was overstated by $1,375 due to an error in the physical count. A $1,650 purchase of merchandise on credit in 2020 was not recorded or included in the ending Inventory. 1. 2. Assuming a periodic inventory system, how would Sue's cost of goods sold, gross profit, and net income be affected in 2020 by these errors? Cost of Goods Sold Net Income Understated Overstated Overstated Understated No effect Overstated No effect No effect Set 1. 11. III. IV. Set II Set IV Set III O set I Gross Profit Understated Understated Overstated No effect
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