An overstatement of the beginning inventory results in
A)no effect on the period's profit.
B)an overstatement of profit.
C)an understatement of profit.
D)a need to adjust purchases.

Question

Quizplus · Accepted Answer

An overstatement of the beginning inventory will result in an overstatement of profit. This is because the cost of goods sold will be understated, leading to a higher gross profit and net income. Therefore, choice B is the correct answer.

An Overstatement of the Beginning Inventory Results in