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Exam Code: C_ARSUM_2102

Exam Name: SAP Certified Application Associate - SAP Ariba Supplier Management

Certification Provider: SAP

Related Certification: SAP Certified Application Associate - SAP Ariba Supplier Management

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NEW QUESTION: 1
If the beginning inventory is overstated and the ending inventory is understated, which of the following is/ are true:
I. COGS is understated
II. COGS is overstated
III. Income is overstated
IV. Income is understated
A. IV only
B. II & IV
C. II only
D. I & III
Answer: B
Explanation:
Explanation/Reference:
Explanation:
COGS = Beginning inventory - Ending inventory + Purchases Hence, if BI is overstated and EI understated, COGS is overstated, implying income is understated. It should be remembered that implicit in the use of the above inventory equation is the assumption that there have been no write-downs or write- ups in the inventory.


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