A New Accountant Working for Metcalf Company Records $800 Depreciation

question 149

Multiple Choice

A new accountant working for Metcalf Company records $800 Depreciation Expense on store equipment as follows: The effect of this entry is to:

• A)adjust the accounts to their proper amounts on December 31.
• B)over state total assets on the balance sheet as of December 31.
• C)overstate the book value of the depreciable assets at December 31.
• D)understate the book value of the depreciable assets as of December 31.

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Definitions:

GNP

Gross National Product; the total value of goods produced and services provided by a country during one year, plus the net income from foreign investments.

GDP

Gross Domestic Product, which is the total value of all goods and services produced within a country's borders in a specific time period.

Households

Economic units consisting of all persons who occupy a dwelling, which make decisions on consumption, savings, and investments.

Firms

Business organizations that use resources to produce goods or services for sale with the aim of making a profit.