If ending inventory on the last day of the year is overstated by $14,000, what is the effect on net income for the current year?

Select one:

a. Net income is overstated by $28,000.

b. The answer cannot be determined from the information given.

c. Net income is understated by $14,000.

d. Net income is overstated by $14,000.

Question 9

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A business purchased merchandise for $15,000 on account; terms are 2/10, n/30. If $2,600 of the merchandise was returned and the remaining amount due was paid within the discount period, the purchase discount would be:

Select one:

a. $300

b. The right answer is not listed here.

c. $52

d. $248

Question 10

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On December 31, 2015, Company A reports total assets of $4,500,000 and total equity of $2,345,000. All liabilities are current (the company has no long-term debt). The company has a current ratio of 0.7. How much are current assets?

Select one:

a. -$646,500

b. $1,641,500

c. $3,078,571

d. $1,508,500