Post Utme Caleb University 2017 Commerce Question 11

Practice objective / multiple choice question 11 from the 2017 Post Utme Caleb University Commerce examination.

Post Utme Caleb University 2017 Commerce Objective / Multiple Choice
Question 11 POST_UTME_CALEB_UNIVERSITY • 2017 • COMMERCE • objective

A company's inventory management system uses a first-in-first-out (FIFO) method to track stock levels. If the system is not properly calibrated, what is the likely consequence on the company's financial statements?

Answer Options

A. The company's revenue will increase due to overstocking.
B. The company's cost of goods sold will be understated.
Correct Answer C. The company's inventory levels will be misreported.
D. The company's cash flow will be negatively impacted.
Correct Answer
C
Correct Option:
The company's inventory levels will be misreported.

About This Question

This is Post Utme Caleb University 2017 Commerce Question 11. It is one of the objective questions from the 2017 Post Utme Caleb University Commerce examination.

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