The Following Errors Were Discovered During January 20x3 (Prior to Any

question 131

Multiple Choice

The following errors were discovered during January 20x3 (prior to any reversing entries) The accounting period ends December 31. What effect did these errors have on the 20x2 pre-tax income?

• A)Understated by $1,000
• B)Understated by $2,000
• C)Overstated by $1,000
• D)Overstated by $2,000

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Definitions:

Fundamental Attribution Error

The tendency to overestimate the effect of personality or disposition and underestimate the influence of situational factors when explaining others' behaviors.

External Situation

Circumstances or factors outside oneself that influence one’s behavior and actions, often beyond one's control.

Inner Traits

Inherent characteristics or qualities that contribute to an individual's personality and behavior.

Social Comparison

The process of evaluating one's abilities, achievements, and attributes by comparing oneself to others.