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question content area if a company mistakenly counts less items during a physical inventory than actually exist, how will the error affect the cost of merchandise sold? a.understated b.no change c.only inventory will be affected d.overstated

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An erroneous physical inventory will cause the cost of goods sold and net income to be overestimated.

How does inventory work?

All the goods, services, and equipment that a company keeps in hand with the goal of selling them for just a profit are referred to as inventory. Example: If a paper provider uses a vehicle to deliver newspapers to customers, just the newspaper will be considered inventory.

What are the four different types of inventory?

Although there are more types of inventory, the four main ones are raw materials and components, finished goods, collaborate, and upkeep, repair, and operational supplies. Inventory is regarded as an asset by businesses since it costs money to purchase it, which it then sells for a profit.

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