Ronn Industries
Ronn Industries reported net income of $95,000 for 2012. Early in 2013, Ronn discovered that its 2012 ending inventory was overstated by $5,000.
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Refer to the information provided for Ronn Industries. Determine the financial statement effects of the inventory error for 2013.
A) Expenses will be understated and net income will be overstated.
B) Expenses will be overstated and net income will be understated.
C) Both expenses and net income will be overstated.
D) Both expenses and net income will be understated.
Correct Answer:
Verified
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