The accountant for Barnes Architectural Services failed to make an adjusting entry to record $7,000 of depreciation expense.Which of the following is TRUE?
A) Total revenue is overstated.
B) Total revenue is understated.
C) Total expenses are overstated.
D) Total expenses are understated.

Question

Quizplus · Accepted Answer

The failure to record the depreciation expense will result in total expenses being understated. This means that the net income will be overstated, as expenses have not been properly recorded.

The Accountant for Barnes Architectural Services Failed to Make an Adjusting