Use the Following Information for Questions

question 34

Multiple Choice

Use the following information for questions.
Fairfax Inc. began operations on January 1, 2019. Financial statements for 2019 and 2020 contained the following errors: In addition, on December 31, 2020 fully depreciated equipment was sold for $ 7,200, but the sale was NOT recorded until 2021. No corrections have been made for any of the errors. Ignore income tax considerations.
-The total effect of the errors on Fairfax's 2020 net income is

• A) understated by $ 94,200.
• B) understated by $ 61,200.
• C) overstated by $ 28,800.
• D) overstated by $ 49,800.

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Definitions:

Phenotype

The observable physical or biochemical characteristics of an organism, as determined by both genetic makeup and environmental influences.

Genotype

The genetic makeup of an organism, consisting of all the DNA and genes that contribute to its unique traits.

Somatotype

A classification system for human body types based on physical and physiological characteristics.

Polygenic Trait

A trait influenced by multiple genes, resulting in a wide range of potential outcomes or appearances.