June 1	Beginning Inventory	10	$3	$30
June 2	Purchase	30	$4	$120
June 10	Purchase	40	$6	$240
June 12	Sale	60	$20	$1,200
June 17	Purchase	70	$7	$490
June 21	Purchase	50	$10	$500
June 29	Sale	80	$22	$1,760

• Assume the company uses the PERIODIC method for inventory.
• Additional Information: The ending inventory consists of 15 units purchased on 6/2, 25 units purchased on 6/10, and the remaining units were purchased on 6/21.

  Question 20 (Mandatory) (3 points)

  If Year 1s beginning inventory is understated, what is the impact on Year 2s Cost of Goods Sold?

  Question 20 options:

  	Overstated
  	No Impact
  	Understated

  Question 21 (Mandatory) (3 points)

  If Year 1s ending inventory is understated, what is the impact on Year 1s Cost of Goods Sold?

  Question 21 options:

  	No Impact
  	Understated
  	Overstated

  Question 22 (Mandatory) (3 points)

  If Year 1s ending inventory is overstated, what is the impact on Year 1s Gross Margin?

  Question 22 options:

  	Understated
  	Overstated
  	No Impact

  Question 23 (Mandatory) (3 points)

  If Year 1s ending inventory is understated, what is the impact on Year 2s Cost of Goods Sold?

  Question 23 options:

  	Overstated
  	Understated
  	No Impact