Repeat M7-23, except assume the 2018 ending inventory was overstated by $10,000. Data from M7-23: Assume the

Question:

Repeat M7-23, except assume the 2018 ending inventory was overstated by $10,000.

Data from M7-23:

Assume the 2018 ending inventory of Shea’s Shrimp Shack was understated by $10,000. Explain how this error would affect the amounts reported for cost of goods sold and gross profit for 2018 and 2019.

Ending Inventory
The ending inventory is the amount of inventory that a business is required to present on its balance sheet. It can be calculated using the ending inventory formula Ending Inventory Formula =...

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