An error in the period-end inventory will cause an error in the calculation of cost of goods sold.

Name: An error in the period-end inventory will cause an error in the calculation of cost of goods sold.
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Question

Quizplus · Accepted Answer

The cost of goods sold is calculated by subtracting the cost of goods available for sale from the period's beginning inventory. If the period-end inventory is incorrect, the cost of goods available for sale will be misstated, resulting in an error in the calculation of cost of goods sold.

An Error in the Period-End Inventory Will Cause an Error