Poppy Co. uses a periodic inventory system. Beginning inventory on January 1 was understated by $30,000, and its ending inventory on December 31 was understated by $17,000. In addition, a purchase of merchandise costing $20,000 was incorrectly recorded as a $2,000 purchase. None of these errors were discovered until the next year. As a result, Poppys cost of goods sold for this year was:
A.	Overstated by $31,000.
B.	Overstated by $5,000.
C.	Understated by $31,000.
D.	Understated by $48,000.
Answer:C
Poppy Co. uses a periodic inventory system. Beginning inventory on January 1 was understated by $30,000, and its ending inventory on December 31 was understated by $17,000. In addition, a purchase of merchandise costing $20,000 was incorrectly recorded as a $2,000 purchase. None of these errors were discovered until the next year. As a result, Poppys cost of goods sold for this year was:
A.	Overstated by $31,000. B.	Overstated by $5,000. C.	Understated by $31,000. D.	Understated by $48,000.