Which of the following statements is correct? Options: • The net income would still be the same regardless of accounting method that is used whether cash basis or accrual basis • Pre-collections initially recorded as income will overstate the profit at the end of the accounting period if no adjustment is done for unearned portion • Deferral is intended to recognize income earned but not yet received • Accrual of expenses will increase the expense element and will correspondingly decrease the liability

Q: Which of the following statements regarding accounting change is correct? a. Change in depreciation…

A: Accounting changes means when there is some change in the process and methodologies related to…

Q: Which statement is incorrect? *

A: Financial statement: Financial information is a written record of an organization and individual…

Q: Interest expense is listed on the Income Statement in 'Other revenue and Expenses'. Assess the…

A: Interest Expenses: The cost that an organization must pay to service its interest obligation is…

Q: Which of the following statements is not correct regarding combined statement of financial position…

A: The combined statement of financial position errors and income statement errors effects both the…

Q: If it is impracticable to determine the cumulative effect of an accounting change to any of the…

A: There are situations when company adopt to new method of accounting due to which changes occur in…

Q: Match the statements below with the accounting assumption, characteristic, or principle to which the…

A: Introduction: Accounting: Accounting is an art of recording , classifying , summarising and…

Q: (Recognition of Revenue—Theory) Revenue is recognized for accounting purposes when a performance…

A: Accounting:   Accounting is a system, or a process of collecting and organizing economic…

Q: If the income statement error is discovered in a subsequent accounting period, what action is to be…

A: Solution Nominal account is a general ledger account pertaining to all income , expenses , losses…

Q: Which of the following is not a characteristic of non-counterbalancing error? Group of answer…

A: Non counter balancing errors are those errors which will not be automatically corrected in the next…

Q: Prospective application of recognizing the effect of a change in an accounting estimate means A.…

A: Prospective means expected or expecting thing in the future. Financial statements are the reports of…

Q: Which of the following would trigger a subtraction in the indirect operating section? A. decrease in…

A: The correct option is B that is, gain on sale of investments as it is a non-operating gain that is…

Q: Please explain the meaning of the following statement, I don't understand. The income reports net…

A: Income: It is often defined as the amount that is generated by a business from performing its…

Q: I am providing you with a response to a question I asked. The individual did not explain throughly…

A: We’ll answer the first question since the exact one wasn’t specified. Please submit a new question…

Q: Accountants use reserve accounts for various reasons, for each of the cases below describe a…

A: Uses of reserves

Q: Accounting for all possible losses and expecting no profit is as per O a. Revenue recognition…

A: Answer : Option (C ) conservatism Principle

Q: Which statement is incorrect? A. Deferred income-beginning

A: Prepaid Expenses -: Prepaid Expenses are forthcoming expenditures that have been reimbursed in…

Q: What is false about the matching principle? a. Incurred expenses should be matched with earned…

A: Matching principles are those principles which emphasize on matching of revenues of the business…

Q: matching revenues and expenses in the same period

A: Matching concept is a fundamental concept in accounting. According to this concept, revenues and…

Q: Which of the following statements about a change in accounting estimate is not true?

A: Accounting estimates are judgments and assumptions made by management in measuring various assets ,…

Q: A change from cash basis to accrual basis should be reported A. Retroactively as a correction of…

A: Cash basis refers to the accounting of the transactions as and when the cash is received. Whereas…

Q: If the statement of financial position error is discovered in the year of error, what action is to…

A: Errors mean the data entered in the financial system is not as per accounting standard. There has…

Q: Which statement is incorrect?  a. Notes to financial statements (F/S) provide narrative description…

A: statement is incorrect e. none of the above   Statement is incorrect: c. Expenses encompasses both…

Q: An accrued expense can best be described as an amount Paid and currently matched with earnings…

A: Solution Concept Accrued expense Accrued expense means the expense that has already been incurred…

Q: Which one of these statements is true of the accumulated depreciation account? O the account is to…

A: Accumulated depreciation is the total of depreciation applied on a fixed asset on a particular point…

Q: Which statement is incorrect? * A.the FUNCTIONAL Income Statement classifies expenses into cost of…

A: Income statements determine the net income of the entity and its included revenue and gains, expense…

Q: A gain or loss from a transaction that is unusual in nature or infrequent in occurrence should be…

A: Unusual and infrequent transactions are those transactions which are not regular in nature and will…

Q: which of the following is an accounting concept which serves as the basis for revenue and expense…

A: Accounting principles: Accounting principles are the conventions or rules that must be followed in…

Q: Which statement is incorrect?

A: 1. The statement of comprehensive income is prepared to present the unrealised gain and losses which…

Q: Which of the following statements about accounting income and economic income is (are) correct? I.…

A: Accounting profits includes explicit costs only, whereas economic profits includes both explicit and…

Q: tate the effect of the following errors if OVERSTATED, UNDERSTATED, or NO EFFECT. NO. ERRORS EFFECT…

A: Solution  Concept Retained earnings is understated if net income is understated Retained earnings is…

Q: The concept of materiality: a                      Treats as material only those items that are…

A: The materiality concept in accounting states that all the items that are material to the company…

Q: Which statement is incorrect? A. The FUNCTIONAL Income Statement classifies expenses into cost of…

A: Financial statement: Financial information is a written record of an organization and individual…

Q: The effect of a revision of an accounting estimate must be recognised in profit and loss in which…

A: The estimate is based upon the opinion of one person that can vary in upcoming periods.

Q: Which of the following is the incorrect effect of counterbalancing errors? a. None of the…

A: Counterbalancing error is made when  an error is made that cancels out another error. For example…

Q: If the adjustment for unearned revenues is not recorded O a. net income will be correctly stated. O…

A: Lets understand the basics. Adjustment entry is need to pass at year end to follow matching…

Q: Which of the following statements is correct?   Options: • Prepayments of supplies initially…

A: Solution: "If unpaid expenses incurred during the accounting period are not accrued, the income for…

Q: What is the accounting treatment for discontinued operations? A :    It is reported at its gross…

A: In the today's world, it is possible that an entity of group is not earning profit due to several…

Q: If the statement of financial position error is discovered in a subsequent accounting period, what…

A: The error in the financial statement could be cause due to any mathematical mistakes or other…

Q: Recording bad debt expense under the allowance method will have what effect on the financial…

A: The allowance method involves setting aside a reserve for bad debts that are expected in the future.…

Q: What is the effect of omission of prepaid expense in retained earnings at the end of year 2? Group…

A: Prepaid expenses are those expenses which are related with future period of time but paid in advance…

Q: Which of the following is not a criterion to recognize revenue under GAAP?A. The earnings process…

A: GAAP is the generally accepted accounting principles that are used by the accountants for the…

Q: Which statement is not true about accrual and deferral? A. A deferred income is an amount collected…

A: Accruals: Accruals are the revenues that are earned but not received, and expenses that are incurred…

Q: Which sentence is incorrect? Select one: a. According to the GAAP in Accrual-Basis Accounting,…

A: As per cash basis of accounting, we should record the transaction only when corresponding cash is…

Q: Presented below are the assumptions, principles, and constraint used in this chapter. 1.    Economic…

A: Going concern assumption: The going concern assumption emphasizes on the longevity of the company's…