Q1 On the balance sheet double counting a portion of
Q1. On the balance sheet, double counting a portion of ending inventory will result in (understating / having no affect on / ________) ending inventory and (understating / having no affect on / ________) total assets.
Q2. On the income statement, double counting a portion of ending inventory will result in (________/ having no affected on / ________) cost of goods sold (COGS) and (understating / having no affect on / overstating) gross profit.
Q3. To qualify for the year-end bonus, the manager (________/ should not) double count over two thousand dollars of ending inventory. Why?
Q4. Is intentionally double counting ending inventory ethical? (Yes / ________/ Maybe) Why?
Q5. Is intentionally double counting ending inventory legal? (Yes / ________ / Maybe) Why?
Q6. List some possible consequences if upper management detects double counting of ending inventory.
Q7. Discuss some ways the double counting of inventory could be detected by management.
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