During its December 31, 2017 year-end inventory count, Jefferson Company failed to count items in transit to which it had legal title. As a result of this error, ending inventory was understated by $30,000. As a result of this error, 2017 cost of goods sold will be

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Since the items in transit were not counted, they were not included in the ending inventory value, which caused the ending inventory to be understated by $30,000. This means that the cost of goods sold was overstated by $30,000.

During Its December 31, 2017 Year-End Inventory Count, Jefferson Company