Evaluate each inventory error separately and determine whether it overstates or understates cost of goods sold and net income.Inventory error:Cost of goods sold is:Net income is:Understatement of beginning inventory________________Understatement of ending inventory________________Overstatement of beginning inventory________________Overstatement of ending inventory________________
What will be an ideal response?
| Inventory error: | Cost of goods sold is: | Net income is: |
| Understatement of beginning inventory | Understated | Overstated |
| Understatement of ending inventory | Overstated | Understated |
| Overstatement of beginning inventory | Overstated | Understated |
| Overstatement of ending inventory | Understated | Overstated |
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