Error in Inventory During 2085, the accountant discovered that the physical inventory at the end of 2074 had been understated by $42,750. Instead of correcting the error, however, the accountant assumed that the error would balance out (correct itselt') in 20Y5. Which of the following is correct? Oa. When an errot is ditovered alfecting the prior period, it should be corrected. In this case, the merchandise inventory account should be debited and the owner's capital account credited for $42.750. Ob. Pallure to correct the error for 2084 and purposely mistating the inventory and the cost of merchandise sold in 2015 would cause the income statements for the two years to Dot be comparable Oc The balance sheet at the end of 2075 would be incorrect unless an adjustment is made Od. "When an erroris discovered affecting the prior period, it should be corrected in this case, the merchandise inventory account should be dobited and the wner's capital account credited for 542.750." and "Failure to correct the error for 2014 and purposely miastating the inventory and the cost of merchandise sold in 2075 would cause the income statements for the two years to not be comparable are correct. Oe. Palure to correct the error for 20v4 and purposely mistating the inventory and the cost of merchandise sold in 2075 would note the income statements for the two years to not be comparable." and "The balance iheet at the end of 20's would be incorrect unless and adjustment is made are correct Previous Next 5110