Accounting for IGCSE & O level - Accounting Procedures (Section 14 - No. 45)
If an item of inventory was counted twice during the year-end inventory count, how would this error affect the financial statements?
Cost of Goods Sold (COGS) is understated, and profit is overstated.
Cost of Goods Sold (COGS) is overstated, and profit is understated.
Cost of Goods Sold (COGS) and profit are overstated.
There will be no impact on the financial statements.
Explanation
Counting items twice will overstate inventory, and overstate the profit.
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