The Accountant for Barnes Architectural Services Failed to Make an Adjusting

question 56

Multiple Choice

The accountant for Barnes Architectural Services failed to make an adjusting entry to record $7 000 of depreciation expense. Which of the following is TRUE?

• A)Total expenses are understated.
• B)Total expenses are overstated.
• C)Total revenue is overstated.
• D)Total revenue is understated.

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Definitions:

Systems Design

The process of defining the architecture, components, modules, interfaces, and data for a system to satisfy specified requirements.

Cash Equivalents

Short-term, highly liquid investments that are easily convertible into known amounts of cash with original maturities of three months or less.

Highly Liquid

Describes assets that can be quickly and easily converted into cash with minimal impact on their value.

Vouchers

Documents that serve as evidence of a transaction and propose a future payment, detailing the conditions and amounts to be paid.