Question
A company uses a periodic inventory system and includes goods in transit that were shipped FOB shipping point in purchases but not in ending inventory.
A company uses a periodic inventory system and includes goods in transit that were shipped FOB shipping point in purchases but not in ending inventory. What will be the impact on the current ratio?
Group of answer choices
a.overstate the current ratio.
b. understate the current ratio.
c.have no effect on the current ratio.
d. there isn't sufficient information to determine the effect.
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Cost Accounting A Managerial Emphasis
Authors: Charles T. Horngren, George Foster, Srikant M. Datar
8th Edition
0131810669, 978-0131810662
