In Consolidation at December 31, 2019, What Adjustment Is Necessary

question 76

Multiple Choice

In consolidation at December 31, 2019, what adjustment is necessary for Hogan's Equipment account?

• A) $3,000 increase.
• B) $3,000 decrease.
• C) $2,700 increase.
• D) $2,700 decrease.
• E) No adjustment is necessary.

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Definitions:

Assets

Resources owned or controlled by a company that are expected to provide economic benefits or value in the future.

Expenses

Costs incurred by a business in the process of earning revenue, such as salaries, rent, and utilities.

Assets

Resources owned or controlled by a company with expected future economic benefit.

Revenues

The total amount of money generated by a company from its normal business operations, before any costs or expenses are deducted.