What is the effect of the error on Berkshire's 2009 income statement?
A) Net income is understated by $420,000.
B) Cost of goods sold is understated by $420,000.
C) There are no errors in the 2009 income statement.
D) None of these is correct.Cost of goods sold is understated by $600,000 because the beginning inventory is understated.Net income is overstated by $420,000.
Correct Answer:
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