Asked by elizabeth odegard on Jun 04, 2024
Verified
The correct 2010 net income for Margie Company, after error corrections, was $56, 000.Two errors were found after net income was first reported.The January 1, 2010 inventory and the December 31, 2010, inventory were overstated by $4, 000 and $9, 000, respectively.The net income that must have been originally reported was
A) $43, 000
B) $51, 000
C) $61, 000
D) $69, 000
Inventory Overstated
Refers to a situation where the recorded amount of inventory is higher than the actual physical inventory, potentially distorting financial statements.
Error Corrections
Adjustments made in financial statements to amend previously incorrect accounting entries and reports.
Originally Reported
Originally reported refers to the initial financial figures or data that were officially announced or published by a company or organization.
- Examine the impact that errors in inventory valuation have on the accounting statements.
- Explore the implications of modifications in accounting techniques and the resolution of errors on financial disclosures.
Verified Answer
Learning Objectives
- Examine the impact that errors in inventory valuation have on the accounting statements.
- Explore the implications of modifications in accounting techniques and the resolution of errors on financial disclosures.
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