During the taking of its physical inventory on December 31, 20Y4, Barry's Bike Shop incorrectly counted its inventory as $225,870 instead of the correct amount of $179,251. The effect on the balance sheet and income statement would be a. assets overstated by $46,619; retained earnings understated by $46,619; and net income statement understated by $46,619 b. assets overstated by $46,619; retained earnings understated by $46,619; and no effect on the income statement c. assets, retained earnings, and net income all overstated by $46,619 d. assets and retained earnings overstated by $46,619; and net income understated by $46,619
During the taking of its physical inventory on December 31, 20Y4, Barry's Bike Shop incorrectly counted its inventory as $225,870 instead of the correct amount of $179,251. The effect on the balance sheet and income statement would be a. assets overstated by $46,619; retained earnings understated by $46,619; and net income statement understated by $46,619 b. assets overstated by $46,619; retained earnings understated by $46,619; and no effect on the income statement c. assets, retained earnings, and net income all overstated by $46,619 d. assets and retained earnings overstated by $46,619; and net income understated by $46,619
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
During the taking of its physical inventory on December 31, 20Y4, Barry's Bike Shop incorrectly counted its inventory as $225,870 instead of the correct amount of $179,251. The effect on the
a. assets overstated by $46,619; retained earnings understated by $46,619; and net income statement understated by $46,619
b. assets overstated by $46,619; retained earnings understated by $46,619; and no effect on the income statement
c. assets, retained earnings, and net income all overstated by $46,619
d. assets and retained earnings overstated by $46,619; and net income understated by $46,619
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