Overvaluation of opening stock in financial accounting results ________.

The correct answer is: A. decreases costing profit

Overvaluation of opening stock in financial accounting results in a decrease in costing profit. This is because the cost of goods sold is higher when opening stock is overvalued. The cost of goods sold is calculated by taking the opening stock, adding the purchases, and then deducting the closing stock. When opening stock is overvalued, the cost of goods sold will be higher, which will lead to a decrease in costing profit.

Here is a more detailed explanation of each option:

• Option A: Decreases costing profit. This is the correct answer. As explained above, overvaluation of opening stock will lead to a decrease in costing profit.
• Option B: Decreases financial accounts profit. This is incorrect. Overvaluation of opening stock will not affect financial accounts profit. Financial accounts profit is calculated by taking the revenue, deducting the cost of goods sold, and then deducting the expenses. The cost of goods sold is not affected by overvaluation of opening stock, so financial accounts profit will not be affected either.
• Option C: Increases costing profit. This is incorrect. As explained above, overvaluation of opening stock will lead to a decrease in costing profit.
• Option D: Increases financial accounts profit. This is incorrect. As explained above, overvaluation of opening stock will not affect financial accounts profit.