Hawk Store counted some of its inventory twice.As a result, its operating expenses will be
A) Understated
B) Correct only if Hawk Store calculates it cost of goods sold correctly
C) Overstated
D) Correct since operating expenses are not affected by inventory costs

Question

Quizplus · Accepted Answer

Operating expenses are not directly affected by inventory counts, as they typically include costs related to the day-to-day functioning of a business, such as rent, utilities, and salaries, rather than costs associated with inventory or cost of goods sold.

Hawk Store Counted Some of Its Inventory Twice