ACC 304 Course Great Wisdom / tutorialrank.com ACC 304 Course Great Wisdom / tutorialrank.com | Page 84

c. The closing inventory of the current year is understated.

d. Income of the following year will be understated.

S28. When the cost-of-goods-sold method is used to record
inventory at market

a. there is a direct reduction in the selling price of the
product that results in a loss being recorded on the income
statement prior to the sale.