Question: You have recently begun a new job as an internal
You have recently begun a new job as an internal auditor for a large retail clothing chain. The company prepares a multiple-step income statement. You discover that a material amount of salaries expense was erroneously classified as a nonoperating expense. One of your co-workers argues that the error need not be corrected because the net income number is not affected by the misclassification. You disagree. Defend your position.
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