Question
9.On December 31, 2015, Jones Company understated ending inventory by $52,000. How does this error affect Cost of Goods Sold and Net Income for 2015?
9.On December 31, 2015, Jones Company understated ending inventory by $52,000. How does this error affect Cost of Goods Sold and Net Income for 2015?
Overstates Cost of Goods Sold and understates Net Income
Overstates both Cost of Goods Sold and Net Income
Understates Cost of Goods Sold and overstates Net Income
Leaves both Cost of Goods Sold and Net Income correct because the errors cancel each other
10. Comfort Clothing had the following financial data for the year ended December 31, 2015:
Cost of Goods Sold | $ 256,000 |
Beginning Merchandise Inventory | $ 58,000 |
Ending Merchandise Inventory |
What is the inventory turnover for Comfort Clothing (rounded to one decimal place)?
0.7 times per year
1.6 times per year
2.4 times per year
3.1 times per year
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