When a Self-Correcting Error Is Discovered After Closing the Books

question 79

Multiple Choice

When a self-correcting error is discovered after closing the books for the second year ________.

• A) no entry is necessary because all permanent accounts are correctly stated
• B) an entry is necessary to correct the permanent accounts
• C) an entry must be made to correct both the income statement and balance sheet accounts
• D) an entry must be made to correct the income statement

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Definitions:

Unemployment Rate

The segment of workers within the labor force not employed but searching for work.

Assembly Line

A production process that divides the manufacture of a product into steps that are completed in a predefined sequence, often involving conveyor belts and workstations.

U.S. Industry

The collective group of manufacturing, services, and sector-specific companies operating within the United States.

Unemployment Rate

The figure showing unemployed individuals in the labor force who are searching for jobs actively.