Since an error in the period-end inventory causes an offsetting error in the next period:
A) Is immaterial for managerial decision making.
B) It is said to be self-correcting.
C) Managers can ignore the error.
D) If affects only balance sheet accounts.
E) It affects only income statement accounts.

Question

Quizplus · Accepted Answer

An error in the period-end inventory is said to be self-correcting because the offsetting error will affect the next period's financial statements. This means the error will eventually correct itself and not have a long-term impact on managerial decision making.

Since an Error in the Period-End Inventory Causes an Offsetting