Marin recorded the purchase of a new delivery vehicle as a delivery expense for the current year. What type of financial statement fraud is being committed by Marin?

Question

Quizplus · Accepted Answer

Marin is committing financial statement fraud by expensing costs that should be capitalized. The purchase of a new delivery vehicle should be recorded as an asset and depreciated over its useful life, not expensed in the year of purchase.

Marin Recorded the Purchase of a New Delivery Vehicle as a Delivery