If the Prepaid Expenses Are Not Adjusted,assets on the Balance

question 74

Multiple Choice

If the prepaid expenses are not adjusted,assets on the balance sheet

• A) will be overstated.
• B) will be understated.
• C) will not be affected.
• D) may be either overstated or understated.

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Definitions:

Transaction

This refers to any event or action that changes the financial position or the financial statements of a company.

Posted

The process of recording financial transactions in the ledger accounts as part of the accounting cycle.

Reference Column

A column in financial documentation used to indicate a source document or correlation with another piece of data, aiding in tracking and auditing.

Trial Balance

A trial balance is a bookkeeping report that lists the balances in each of an organization's general ledger accounts, typically used to check the mathematical accuracy of bookkeeping entries.