Use the following to answer questions 39 –40 MATCH... For each of the following independent situations, fill in the blanks to indicate the effect of the error on each of the various financial statement items. Assume that each of the companies uses a periodic inventory system. Indicate: (A) an understatement (B) an overstatement or (C) no effect, correct Balance Sheet Income Statement Net Income Ending Inventory Earnings Retained Cost of Error Goods Sold 39. Understated EI in year 1, affect on items in year 1. a. b. с. d. 40. JUnderstated EI in year 1, affect on items in year 2. Ja. b. d. с.

Use the following to answer questions 39 –40 MATCH... For each of the following independent situations, fill in the blanks to indicate the effect of the error on each of the various financial statement items. Assume that each of the companies uses a periodic inventory system. Indicate: (A) an understatement (B) an overstatement or (C) no effect, correct Balance Sheet Income Statement Net Income Ending Inventory Earnings Retained Cost of Error Goods Sold 39. Understated EI in year 1, affect on items in year 1. a. b. с. d. 40. JUnderstated EI in year 1, affect on items in year 2. Ja. b. d. с.

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Description: Use the following to answer questions 39 –40MATCH... For each of the following independentsituations, fill in the blanks to indicate the effect of the erroron each of the various financial statement items. Assumethat each of the companies uses a per

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Inventory Valuation

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in the market with the motive of earning profit.

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