O'Reilly logo

Problem Solving Survival Guide to accompany Financial Accounting, 8th Edition by Donald E. Kieso, Paul D. Kimmel, Jerry J. Weygandt

Stay ahead with the world's most comprehensive technology and business learning platform.

With Safari, you learn the way you learn best. Get unlimited access to videos, live online training, learning paths, books, tutorials, and more.

Start Free Trial

No credit card required

EXERCISE 6-5

Purpose: (L.O. 5) This exercise will test your skill in analyzing inventory errors and determining their effects on the financial statements.

Four separate situations are described below:

  1. An error in the physical count on December 31, 20XA caused the inventory to be overstated.
  2. An error in the physical count on December 31, 20XA caused the inventory to be understated.
  3. An error in the physical count on December 31, 20XB caused the inventory to be overstated.
  4. An error in the physical count on December 31, 20XB caused the inventory to be understated.

Instructions

For each of the independent situations, explain the effect of each error by filling in the matrix with the proper code letters.

images

images

With Safari, you learn the way you learn best. Get unlimited access to videos, live online training, learning paths, books, interactive tutorials, and more.

Start Free Trial

No credit card required