Statements about the financial reports


HCI, Inc. understated its ending inventory by $6,000 in 2006. Assume HCI, Inc. has a 25 percent income tax rate. Which of the following statements about the financial reports of HCI, Inc. for 2006 is correct?

a) Ending inventory will be overstated by $4,500.

b) Ending inventory will be understated by $4,500.

c) Cost of sales will be overstated by $1,500.

d) Net income will be understated by $4,500.

Request for Solution File

Ask an Expert for Answer!!
Accounting Basics: Statements about the financial reports
Reference No:- TGS071807

Expected delivery within 24 Hours