Question

The ending inventory of Sandie’s Candies is overstated by $75,000 at December 31, 20x8. What is the effect on 20x8’s net income, assuming that no other inventory errors have occurred during 20x8?

a. $150,000 overstated
b. $75,000 understated
c. no effect
d. $75,000 overstated

Answer 1

$75,000 overstated

Step-by-step explanation:

An overstatement of a year's ending inventory, absent any other errors, will lead to a decrease in Cost of Goods Sold (COGS), and an increase in Net Income.

Answer 2

The answer is the dickie fingers of the day 75000