What Is the Effect on the Financial Statements When a Company

question 92

Multiple Choice

What is the effect on the financial statements when a company fails to adjust the unearned revenue account for revenues earned at year-end?

• A)Net income is understated and assets are understated.
• B)Revenues are understated and liabilities are understated.
• C)Net income is understated and liabilities are overstated.
• D)Revenues are understated and stockholders' equity is overstated.

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