On December 15, 20X1, a corporation accepted delivery of goods for resale which

Question

On December 15, 20X1, a corporation accepted delivery of goods for resale which it purchased on credit. As of December 31, the company had not recorded the transaction, sold the merchandise or included the merchandise in its physical count of inventory. The effect of this on the balance sheet for December 31, 20X1 would be: (a) Assets and stockholders' equity were understated but liabilities were 11. not affected. Stockholders' equity was the only item affected by the omission. Assets and liabilities were understated but stockholders' equity was not affected. (b) (c) sse aokholders' equity were overstated bu liblities wer not affected.

Explanation / Answer

Inventory and accounts paayble were understated by omission Option C assets and liabilities were understated but stockholders' equity was not affected is correct

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