The accountant for We Fly Cheap Airlines forgot to make an adjusting entry at the end of the year to record the portion of unearned revenues that were earned before year-end. What effect did this omission have on the company’s financial statements? Group of answer choices A. Overstated assets and stockholders’ equity. B. Understated assets and stockholders’ equity. C. Understated liabilities and overstated stockholders’ equity. D. Overstated liabilities and understated stockholders’ equity.

The accountant for We Fly Cheap Airlines forgot to make an adjusting entry at the end of the year to record the portion of unearned revenues that were earned before year-end. What effect did this omission have on the company’s financial statements? Group of answer choices A. Overstated assets and stockholders’ equity. B. Understated assets and stockholders’ equity. C. Understated liabilities and overstated stockholders’ equity. D. Overstated liabilities and understated stockholders’ equity.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter22: Accounting For Changes And Errors.

Section: Chapter Questions

Problem 11P: A review of Anderson Corporations books indicates that the errors and omissions pertaining to the...

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