Multiple choice

The undervaluation of opening stock will result in

  1. increase in the cost of goods sold

  2. decrease in the cost of goods sold

  3. increase in the gross profit

  4. decrease the closing stock

  5. both 2 and 3
Reveal answer Fill a bubble to check yourself
E Correct answer
Explanation

The undervaluation of opening stock will result in the decrease in the cost of goods sold and increase in the gross profit. The correct option is option (5).

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