Its omission at year end will result to understated net income Group of answer choices A. Accrued expense B. Accrued income C. Unearned income D. Accrued expense and unearned income
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Its omission at year end will result to understated net income
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- Its omission at year end will result to understated net income. a. accrued expense and unearned income b. unearned income c. accrued income d. accrued expenseWhat is the effect of omission of prepaid expense in net income during the year of error? a. Overstated b. Cannot be determined based on the given information c. Understated d. No EffectIt is added to income received to determine the total income for the yearthat is recorded under the accrual basis of accounting A. deferred income - endB. prepaid expense - begC. accrued income - begD. deferred income - beg
- What is the effect of omission of accrued income in retained earnings at the end of year 2? a.Understated b.Cannot be determined from the given information c.No effect d.OverstatedWhat is the effect of omission of accrued income in retained earnings at the end of year 2? a. Understated b. No effect c. Overstated d. Cannot be determined from the given informationState the effect of the following errors if OVERSTATED, UNDERSTATED, or NO EFFECT. NO. ERRORS EFFECT IN 1. Omission of accrued expense in year 2021 Retained Earnings, 12/31/2022 2. Omission of prepaid expense in year 2021 Net income of 2022 3. Omission of accrued income in year 2021 Asset, 12/31/2022 4. Omission of unearned income in year 2021 Income of 2022 5. Sales of 2021 recorded as sales of 2022 Retained Earnings, 12/31/2022 6. Purchases of 2021 recorded as purchases of 2022 Retained Earnings, 12/31/2022 7. Inventory, 12/31/2021 is overstated Net income of 2022 8. Inventory, 1/1/2021 is understated Net income of 2022 9. Depreciation of 2021 is understated Net income of 2022 10. Interest income is recorded as Rent Income Net income
- What is the effect of omission of prepaid expense in retained earnings at the end of year 2? Group of answer choices a. No effect b. Cannot be determined from the given information c. Understated d. OverstatedIn year 2022, collection of interest income is credited to Interest Expense. What is the effect of the error in year 2022 net income? a. Understated b. No effect c. Cannot be determined based on the given information. d. OverstatedIf the income statement error is discovered in a subsequent accounting period, what action is to be done by the entity? Group of answer choices a. Reclassify the item to its proper nominal account and restate the income statement of the prior year affected by the error. b. Restate the income statement of the prior year affected by the error. c. No reclassifying entry is necessary but restate the income statement of the prior year affected by the error. d. Reclassify the item to its proper nominal account. Recording of next year's sales as sales of the current year will Group of answer choices a. overstate net income of next year b. not affect retained earnings at the end of next year c. understate retained earnings at the end of the current year d. understate net income of the current year
- It is added to income received to determine the total income for the year that is recorded under the accrual basis of accounting: a. deferred income - ending b. prepaid expense - beginning c. accrued income - beginning d. deferred income - beginningWhat is the impact of accrued expenses before year end adjusting entries ? The answer is .A. Understate expenses and understate liabilities. B. Understate assets and understate expenses . C. Overstate assets and understate expenses . D. Understate expenses and overstate liabilities.Corrections of errors in prior period are included inA. Other comprehensive incomeB. Net incomeC. Retained earningsD. Share premium