In 2020, Kevin Company overstates their ending inventory balance by $50,000. What is the effect on the retained earnings balance on December 31, 2020? Question 13 options: Understated by $50,000 Need more information to determine Overstated by $50,000 No effect

In 2020, Kevin Company overstates their ending inventory balance by $50,000. What is the effect on the retained earnings balance on December 31, 2020? Question 13 options: Understated by $50,000 Need more information to determine Overstated by $50,000 No effect

Name: In 2020, Kevin Company overstates their ending inventory balance by $5
Uploaded: 2024-03-20T06:32:37.000Z
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Description: In 2020, Kevin Company overstates their ending inventory balance by $50,000. What is the effect on the retained earnings balance on December 31, 2020? Question 13 options: Understated by $50,000 Need more information to determine Overstated by $50,00

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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1. In 2021, Jules Company realized that its ending inventory was understated byP1,500 in 2019. How should Jules Company handle this? a. An adjustment to reduce inventory by P1,500 needs to be made. b. An adjustment to increase cost of goods sold (COGS) by P1,500 needs to be made. c. An adjustment to increase inventory by P1,500 needs to be made. d. No adjustment needs to be made. 2. For interim reporting, a loss on sale of a business segment occurring in the third quarter is A. Recognized and allocated over the quarters B. Recognized and allocated over four quarters C. Recognized immediately in the third quarter D. Deferred until the annual reporting 3. Under PFRS 8, which of the following is not a criterion used to determine reportable segments? A. Segment assets B. Segment liabilities C. Segment sales D. Operating profit or loss 4. Which among the following errors could cause an understatement of owners' equity and…