Inventory system correctly recorded purchase of merchandise

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Reference no: EM13755213

A company using the periodic inventory system correctly recorded a purchase of merchandise, but the merchandise was not included in the physical inventory count at the end of the accounting period. The error caused which of the following?

An understatement of both net income and inventory.

An overstatement of inventory, purchases, and accounts payable.

An understatement of inventory, purchases, and accounts payable.

An overstatement of net income and inventory.

Reference no: EM13755213

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