At the End of the Fiscal Year, the Usual Adjusting

question 35

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) Owner's 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.

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Definitions:

Unreasonable Manner

Acting or behaving in a way that is not sensible, fair, or rational, often leading to negative consequences or judgments.

Deadly Force

The use of force that is likely to cause, or intended to cause, death or serious bodily harm.

Defense Of Property

Defense of property is a legal doctrine that justifies the use of reasonable force to protect one's property from theft or damage.

Tort Law

A branch of law dealing with civil wrongs or damages caused by one party to another, not arising from contractual obligations.