The Auditors Informed the Company That the Provision for Long

question 8

Multiple Choice

The auditors informed the company that the provision for long service leave was understated by $100 000 at 30 June 2019 and that the account should be adjusted. The effect of the adjustment would be:

• A) liabilities increase and profit decreases.
• B) liabilities increase but profit is unaffected.
• C) profit increases but there is no effect on liabilities.
• D) there is no effect on either profit or liabilities.

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Definitions:

U.S. Troops

Members of the United States Armed Forces, including soldiers, marines, sailors, and airmen serving domestically and abroad.

Western Settlers

Individuals and families who moved westward across North America, especially during the 19th century, often seeking new opportunities and land.

Indian Scalps

Refers to the practice of removing the scalp of Native Americans, often used historically as a trophy of war or proof of kill for bounty payments.

Trade

The action of buying, selling, or exchanging goods and services between people, states, or countries.