At the End of the Current Year,the Accountant for Computer

question 205

Multiple Choice

At the end of the current year,the accountant for Computer Graphics Company forgot to make an adjusting entry to accrue Wages Payable for the company's employees for the last week in December.The wages will be paid to the employees in January.Which of the following is an effect of this error?

• A) Net income is overstated.
• B) Liabilities are overstated.
• C) Net income is understated.
• D) Expenses are overstated.

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Definitions:

1933 Act

The Securities Act of 1933, a U.S. legislation that requires detailed disclosure of financial information from issuers of public securities to protect investors.

Permanent Resident

An individual who has been granted the legal right to live indefinitely within a country other than their nationality.

Issuer

An entity that develops, registers, and sells securities to finance its operations, such as corporations or governmental bodies issuing bonds or stocks.

Sarbanes-Oxley Act

The Sarbanes-Oxley Act is a United States federal law that set new or expanded requirements for all U.S. public company boards, management, and public accounting firms, aiming to protect investors from fraudulent financial reporting.