Financial Accounting

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Inventory Errors: Ending Inventory Under, Purchases Twice

FINACT-RLRRKE

Spring Corporation uses a Periodic Inventory System and reports Merchandising Inventory on the Balance Sheet at \$165,000 on December 31, 2016. During 2017, the accounting department identifies two errors. Ending Inventory for 2016 is understated by \$12,000 and a purchase during 2016 in the amount of \$3,500 was recorded twice.