In preparing the financial statements for December 31,2017,an accountant improperly classified the payment of prepaid rent as rent expense.Which of the following amounts would not be affected by this improper classification?
A)Retained earnings,January 1,2017
B)Retained earnings,December 31,2017
C)Net income
D)Total assets

Question

Quizplus · Accepted Answer

Retained earnings as of January 1, 2017, would not be affected by this misclassification because it reflects the cumulative earnings less dividends up to the beginning of the year 2017, and thus would not include the effects of transactions during 2017.

In Preparing the Financial Statements for December 31,2017,an Accountant Improperly