Effect of the error on the income statement

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Boss Motorcycle Shop sells motorcycles, ATVs, and other related supplies and accessories. During the taking of its physical inventory on December 31, 2010, Boss Motorcycle Shop incorrectly counted its inventory as $195,750 instead of the correct amount of $188,200.

a. State the effect of the error on the December 31, 2010, balance sheet of Boss Motorcycle Shop.

b. State the effect of the error on the income statement of Boss Motorcycle Shop for the year ended December 31, 2010.

Reference no: EM13904948

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