At the End of the Fiscal Year, the Usual Adjusting

question 3

Multiple Choice

At the end of the fiscal year, the usual adjusting entry to prepaid insurance to record expired insurance was omitted. Which of the following statements is true?

• A) total assets at the end of the year will be understated.
• B) stockholders' equity at the end of the year will be understated.
• C) net income for the year will be overstated.
• D) insurance expense will be overstated

---

Definitions:

Uncertainty Principle

The Uncertainty Principle, often associated with Werner Heisenberg, posits that the position and momentum of a particle cannot simultaneously be measured with arbitrary precision.

Stare Decisis

The judicial method of resolving disputes by using established cases as a reference.

Articles of Confederation

The first constitution of the United States, ratified in 1781, which established a weak federal government prior to the adoption of the U.S. Constitution.

National Government

The political authority that governs an entire nation, typically consisting of legislative, executive, and judicial branches.