*Assume periodic inventory system, all sales and purchases are on credit.

NE = no effect

O = amount overstated

U = amount understated

.... for the following accounts under each of the given cirumstances:

ACCOUNTS RECEIVABLE

INVENTORY

ACCOUNTS PAYABLE

SALES

COST OF GOODS SOLD

1. Goods in transit shipped f.o.b. destination to us by a supplier were recorded by us as a purchase but were not included in ending inventory

2. Goods in transit shipped by us f.o.b. shipping point to a customer were not recorded by us as a sale and were included in our ending inventory

3. Good were shipped to us by a supplier but were incorrectly excluded from our ending inventory. Also, the purchase was incorrectly not recorded by us.

4. Goods sent by us on consignment basis to another company were not included in our inventory count and were recorded as our sale.