At the point when an ending inventory overstatement happens, the cost of goods sold is expressed excessively low, which implies that net income before taxes is exaggerated by the measure of the inventory overstatement. Be that as it may, you at that point need to settle income government expenses on the measure of the overstatement. To discuss: What would be the effect on the financial statement if Wal-Mart were overstate its inventory by 1%.

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Chapter 6, Problem 80.6C

To determine

At the point when an ending inventory overstatement happens, the cost of goods sold is expressed excessively low, which implies that net income before taxes is exaggerated by the measure of the inventory overstatement. Be that as it may, you at that point need to settle income government expenses on the measure of the overstatement.

To discuss:

What would be the effect on the financial statement if Wal-Mart were overstate its inventory by 1%.

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