What Is the Effect on the 2014 Financial Statements When

question 99

Multiple Choice

What is the effect on the 2014 financial statements when a capital expenditure during 2014 was incorrectly recorded as a repairs and maintenance expense?

• A) The financial statements are not affected.
• B) Assets and net income are both overstated.
• C)Assets are overstated and net income was understated.
• D)Assets and stockholders' equity are both understateD.Assets are understated because the expenditure should have been capitalized. Stockholders' equity is understated because net income is understated due to the expense overstatement.

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Definitions:

Political Skill

The ability to understand and influence others for personal or organizational benefit within a political environment.

Managing Impressions

The practice of consciously controlling or influencing the perceptions and opinions others have of you.

Developing Strategies

Developing strategies involves creating plans or approaches aimed at achieving specific goals or solving problems within an organization or project.

Reading Others

The ability to understand and interpret the verbal and non-verbal cues, emotions, and behaviors of others, often essential in effective communication and leadership.