Assume That Accrual Basis Accounting Is Used

question 174

Multiple Choice

Assume that accrual basis accounting is used.Which of the following errors would most likely lead to an overstatement of net income in the current year?

• A)Recording revenue when the cash is collected next year although the performance obligation is satisfied in the current year.
• B)Recording an expense when paid next year although it is incurred this year.
• C)Failing to adjust the Deferred Revenue account for the portion of rent earned this year.
• D)Recording revenue earned in the current year when cash is collected this year.

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Definitions:

Excitatory Neurotransmitter

A type of neurotransmitter that promotes the generation of an electrical signal called an action potential in receiving neurons.

Serotonin Transporter

A protein that facilitates the reuptake of serotonin from the synaptic cleft back into the presynaptic neuron.

Neuromodulator

A type of chemical messenger released from neurons in the brain to signal other neurons, modifying their activities and influencing many bodily functions.

Synaptic Cleft

The small gap at the synapse between neurons, through which neurotransmitters are sent to communicate signals.