hard20 pts · first answer countsinventory-valuationerrors

An inventory error across two years

Closing inventory at the end of year 1 was overstated by ₹30,000 and the error was never corrected. Year 2 closing inventory is correct. What is the effect on reported profit?

A.Year 1 profit overstated by ₹30,000 and year 2 profit understated by ₹30,000B.Only year 1 profit is overstated; year 2 is not affectedC.Both years are overstated by ₹30,000D.Year 1 profit understated and year 2 profit overstated by ₹30,000

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An inventory error across two years

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