ec 2 66% a canvas.instructure.com DQuestion 1 1 pts n applying the lower of cost or market method to inventory valuation, market is defined as the current selling price. O True O False D Question 2 1 pts If a period-end inventory amount is reported in error, it can cause a misstatement in all of the following except: O Net income O Current assets O Gross profnt. O Cost of goods sold O Net sales. DL Question 3 1 pts A company's current inventory consists of a canvas.instructure.com Question 3 1 pts A company's current inventory consists of 5,000 units purchased at $6 per unit. Replacement cost has now fallen to $5 per unit. What is the entry the company must record to adjust inventory to market? Debit Cost of Goods Sold $30,000; credit Merchandise Inventory $30,000. O O Debit Loss on Inventory $5,000; credit Cost of Goods Sold $5,000. O Debit Merchandise Inventory $25,000 credit Cost of Goods Sold $25,000. O Debit Merchandise Inventory $30,000: credit Cost of Goods Sold $25,000.i Debit Cost of Goods Sold $5,000; credit Merchandise Inventory $5,000, O DI Question 4 1 pts An understatement of ending inventory will cause an understatement of assets and equity on the balance sheet. O True O False D Question 7 1 pts Overstating beginning inventory will understate cost of goods sold and net income. O True O False DI Question 8 1 pts A company normally sells its product for $20 per unit. However, the selling price has fallen to $15 per unit. This company's current inventory consists of 200 units purchased at $16 per unit. Replacement cost has now fallen to $13 per unit. What is the amount of the lower cost of market adjustment the company must make as a result of this decline in yalue? O $1.400. O $400. O $600. O $800 O $1,000. Question 9 1 pts The understatement of the ending inventory balance causes Cost of goods sold to be understated and net income to be understated Cost of goods sold to be overstated and net income to be understated. O O Cost of goods sold to be overstated and net O Cost of goods sold to be overstated and net O Cost of goods sold to be understated and income to be correct income to be overstated. net income to be overstated Question 10 1 pts The understatement of the beginning inventory balance causes: O Cost of goods sold to be overstated and net income to be understated O Cost of goods sold to be overstated and net income to be overstated. O Cost of goods sold to be understated and net income to be understated. O Cost of goods sold to be overstated and net income to be correct. O Cost of goods sold to be understated and net income to be overstated