A Company Made No Adjusting Entry for Accrued and Unpaid

question 54

Multiple Choice

A company made no adjusting entry for accrued and unpaid employee salaries of $9,000 on December 31. Which of the following statements is true?

• A) It will understate assets by $9,000.
• B) It will overstate assets and liabilities by $9,000.
• C) It will understate net income by $9,000.
• D) It will have no effect on income.
• E) It will understate expenses and overstate net income by $9,000.

---

Definitions:

Cancer

A disease characterized by the uncontrolled division of abnormal cells in the body.

Systemic Lupus Erythematosus

A chronic autoimmune disease that can cause inflammation and damage in various parts of the body, such as the skin, joints, and organs.

Renal Failure

A medical condition where the kidneys lose the ability to remove waste and balance fluids.

"Butterfly" Rash

A facial rash that has the shape of a butterfly, typically spreading across the nose and cheeks, often associated with lupus erythematosus.