O-LevelAccountingVerification of accounting records7707/12 · May/June 2024 · Q291 Mark

Sam's work in progress was $6500 at the start of the year and $11 200 at the end of the year. When Sam prepared his manufacturing account, he forgot to make the adjustment for work in progress. How did this omission affect the cost of production and the gross profit? cost of production gross profit A overstated overstated B overstated understated C understated overstated D understated understated

Aoverstated; overstated

Boverstated; understated

Cunderstated; overstated

Dunderstated; understated

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B: overstated; understated

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Topic: Verification of accounting records, O-Level Accounting (syllabus 7707). Multiple choice, 1 mark.
Source: O-Level Accounting, May/June 2024 Paper 1 Variant 2, question 29.

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