An accounting clerk working for DBB neglected to record the purchase of merchandise in 20x1, which was, shipped f.o.b.shipping point on December 20, 20x1, and which arrived on December 31.The goods were included in the ending 20x1 inventory.What was the effect on DBB's 20x1 cost of goods sold?

Question

Quizplus · Accepted Answer

Since the purchase was not recorded, the cost of the merchandise was not included in the cost of goods sold, leading to an understatement of the cost of goods sold for 20x1.

An Accounting Clerk Working for DBB Neglected to Record the Purchase