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During 2014, Paul Company discovered that the ending inventories repo.pdf

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Paul Company discovered errors in its ending inventory amounts for 2014, with retained earnings at January 1, 2014 being incorrect. Paul uses a periodic inventory system to track inventory. The document provides no context to determine the accurate impact on retained earnings without the inventory errors or consideration of income taxes.

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During 2014, Paul Company discovered that the ending inventories reported on its financial statements were incorrect by the following amounts: Paul uses the periodic inventory system. Prior to any adjustments for these errors and ignoring income taxes, Paul's retained earnings at January 1, 2014, would be: Select one: a. Correct b. $15,000 understated c. $75,000 overstated d. $135,000 understated e. $75,000 understated

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