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linda_us, Master's Degree
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11. An item of inventory purchased this period for $15.00

Resolved Question:

11. An item of inventory purchased this period for $15.00 has been incorrectly written down to its current replacement cost of $10.00. It sells during the following period for $30.00, its normal selling price, with disposal costs of $3.00 and normal profit of $12.00. Which of the following statements is not true?
A) The closing inventory of the current year is understated.
B) Income of the following year will be understated.
C) The cost of sales of the following year will be understated.
D) The current year's income is understated.
Submitted: 5 years ago.
Category: Business and Finance Homework
Expert:  linda_us replied 5 years ago.
Answer is B) Income of the following year will be understated.

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Linda
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