What Is the Effect of the Error on Berkshire's 12/31/2016

question 50

Multiple Choice

What is the effect of the error on Berkshire's 12/31/2016 balance sheet?

• A)There are no errors in the 12/31/2016 balance sheet.
• B)Assets understated by $600,000 and shareholders' equity understated by $600,000.
• C)Assets understated by $420,000 and shareholders' equity understated by $420,000.
• D)Liabilities understated by $180,000 and shareholders' equity overstated by $420,000.

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Definitions:

Reflex

It is an involuntary, immediate response to a specific stimulus without conscious thought.

Classical Conditioning

A learning mechanism where the consistent association of two stimuli leads to a response, initially evoked by the second stimulus, being evoked by the first stimulus alone over time.

Extinction

In psychology, the gradual weakening and disappearance of a conditioned response when the conditioned stimulus is no longer paired with the unconditioned stimulus.

Discrimination

Unjust or prejudicial treatment of different categories of people, especially on the grounds of race, age, or sex.