Which of the Following Statements Is Incorrect

question 31

Multiple Choice

Which of the following statements is incorrect?

• A) Working papers are useful aids in the accounting process.
• B) On the work sheet, the effects of the accounting adjustments are shown on the account balances.
• C) After the work sheet is completed, it can be used to help prepare the financial statements.
• D) On the work sheet, the adjusted amounts are sorted into columns according to whether the accounts are used in preparing the unadjusted trial balance or the adjusted trial balance.
• E) A worksheet is not a substitute for financial statements.

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Definitions:

Modified Accelerated Cost Recovery System (MACRS)

The system of accelerated depreciation allowed for federal tax computations.

5-Year Asset

An asset that is expected to provide economic value or service for a period of five years.

Computers

Electronic devices designed to process, store, and communicate information, playing a crucial role in both personal and professional settings.

Tax Book Value

Refers to the value of an asset or liability for tax purposes, distinguished from the actual market value or the value recorded on financial statements.