Knowledge Check 01 The sales revenue and correct inventory information for Talisman Corporation is provided below. Sales revenue Beginning inventory Purchases Ending inventory Year 1 $75,000 10,000 50,000 12,000 Year 2 $80,000 12,000 60,000 9,000 By mistake, the accountant at Talisman recorded $15,000 as ending inventory for Year 1. What happens to gross profit reported for Year 1 because of this error? Multiple Choice Understated by $3,000 Overstated by $3,000 Unaffected Knowledge Check 01 The sales revenue and correct inventory information for Talisman Corporation is provided below. Sales revenue Beginning inventory Purchases Ending inventory Year 1 $75,000 10,000 50,000 12,000 Year 2 $80,000 12,000 60,000 9,000 By mistake, the accountant at Talisman recorded $15,000 as ending inventory for Year 1. Based on the information provided, the inventory error in Year 1 has no effect on the accounting equation at the end of Year 2. True or False True False Knowledge Check 01 The sales revenue and correct inventory information for Talisman Corporation is provided below. Sales revenue Beginning inventory Purchases Ending inventory Year 1 $75,000 10,000 50,000 12,000 Year 2 $80,000 12,000 60,000 9,000 By mistake, the accountant at Talisman recorded $15,000 as ending inventory for Year 1. Which of the following is true of the total amount reported for cost of goods sold over the two-year period from Year 1 to Year 2 because of the error? Multiple Choice Increases by $3,000 Decreases by $3,000 O Unaffected at $111.000 O O O Unaffected at $63,000 Knowledge Check 01 The sales revenue and correct inventory information for Talisman Corporation is provided below. Sales revenue Beginning inventory Purchases Ending inventory Year 1 $75,000 10,000 50,000 12,000 Year 2 $80,000 12,000 60,000 9,000 By mistake, the accountant at Talisman recorded $15,000 as ending inventory for Year 1. What will be the amount of gross profit reported in Year 2 because of the error? Multiple Choice $14,000 O O $17,000 O $27.000 $30,000 O