Question
Question 2. Mountain Indoors Co. mistakenly recorded purchases of inventory on account received during the last week of December 2016 as purchases during January of
Question 2. Mountain Indoors Co. mistakenly recorded purchases of inventory on account received during the last week of December 2016 as purchases during January of 2017 (this is called a purchases cut-off error). Cameron uses a periodic inventory system. Ending inventory however was correctly counted and reported each year.Assuming that no correction was made in 2016 or 2017, indicate whether each of the following financial statement amounts will be understated, overstated, or correct, explain.
A. Retained Earnings for December 31, 2016.
B. Retained Earnings for December 31, 2017.
C. Net Income for 2016.
D. Net Income for 2017.
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Inside Accounting The Sociology Of Financial Reporting And Auditing
Authors: David Leung
1st Edition
1138251178, 9781138251175
