Select the balance sheet account(s) that would be affected by a policy choice at the same time as the cost of goods sold income statement account.

Question

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The cost of goods sold represents the cost of the inventory that was sold during the period. Therefore, any policy choice made regarding inventory (such as a change in inventory valuation method or a change in the frequency of inventory counts) would affect the cost of goods sold on the income statement and the value of the inventory on the balance sheet. Accounts receivable, accrued expenses, and property, plant and equipment are not directly related to the cost of goods sold.

Select the Balance Sheet Account(s) That Would Be Affected by a Policy