Which is correct If a company fails to make an adjusting entryto record supplies expense, thenexpense will be understated.net income will be understated.assets will be understated.owner's equity will beunderstated.

Adjusting entry for supplies expense decreases the balance of supplies (asset). If the adjusting…

Answered: If a company fails to make an adjusting…

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter3: Accrual Accounting

Section: Chapter Questions

Problem 4MCQ: Which of the following statements is false? Adjusting entries are necessary because timing...

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Similar questions

If a company fails to make an adjusting entry to estimate uncollectible accounts, then this error: A understates assets B understates owners equity C overstates experise D overstates net income
A company fails to recognize an expense incurred but not paid. In dicate which of the following accounts is debited and which is credited in the adjusting entry: (a) asset, (b) liability, (c) revenue, or (d) expense.
If a company doesn’t make adjusting entry for accrued expenses: Liabilities will be overstated; expenses and net income will be understated. Liabilities, expenses and net income will be overstated. Liabilities; expenses and net income will be understated. Liabilities and expenses will be understated, net income will be overstated.
If you fail to journalize and post the adjusting journal entry to depreciate equipment, what is the impact on the financial statements of the company? There is no impact on either the income statement or the balance sheet. Net income is understated, Assets are Understated, and Retained Earnings are understated Expenses are understated, Assets are overstated, and Retained Earnings are overstated Revenue is understated, Liabilities are understated, and Retained Earnings are understated Expenses are understated, Assets are Understated, and Retained Earnings are understated
Failure to prepare an adjusting entry at the end of the period to record an accured expense would casue: (Choose all of the correct ones) A. An understatement of libailities B. An overstatement of revenue C. An understatement of expenses D. An overstatement of net income E. An overstatement of assets
Services were performed but not billed. What effect will this have on the income statement if an adjusting entry is not made? a. Liabilities will be understated.b. Expenses will be overstated.c. Net income will be understated.d. Revenues will be overstated.
If the adjusting entry is not made for unearned revenues, the result will be: A. Overstate assets and understate liabilities B. Overstate liabilities and understate revenue C. Understate net income and overstate owner’s equity D. Understate owner’s equity and overstate revenue
Which of the following is most likely considered an adjusting entry? The entry to record the payment of interest payable The entry to record the collection of accounts receivable The entry to record the purchase of equipment The entry to record bad debts expense for the period
Withdrawals by an owner are found on the income statement as an expense True False
If the income statement error is discovered in the year of error, what action is to be done by the entity? a. Reclassify the item to its proper nominal account. b. Reclassify the item to real account. c. Adjust the effect to the retained earnings account. d. Ignore the error.
Expenses recognized in the wrong accounting period: What does it mean when a company may delay recording an expense by recording as an asset? Please explain.
Please help with the following question, need accurate and full answer. What is the effect on liabilities, stockholder’s equity, revenues and net income if a company does not make an unearned revenue adjusting entry? Explain with suitable examples

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If a company fails to make an adjusting entry to record supplies expense, then expense will be understated. net income will be understated. assets will be understated. owner's equity will be understated.