How many accounting periods are affected by an error in the measurement of ending inventory?

Question

Quizplus · Accepted Answer

An error in the measurement of ending inventory affects two accounting periods - the current period and the next period. This is because the current period's cost of goods sold is understated or overstated, which affects the next period's beginning inventory. Therefore, the error in ending inventory measurement has a ripple effect on the two consecutive accounting periods.

How Many Accounting Periods Are Affected by an Error in the Measurement