Answer: Revenue to be understated
If the fee has not been paid by the end of the accounting period and no adjusting entry is made, this would cause revenue to be understated.
Explanation:
Businesses may be tempted to understate their COGS in order to make their business model look more attractive and their profit more sustainable, making them better candidates for loans. A lower COGS makes the financial statements more attractive – at least until it comes time to pay taxes on the earnings
Fraud in financial statements takes the form of overstated assets or revenue or understated liabilities and expenses. Overstating assets and revenues falsely reflect a financially stronger company by the inclusion of fictitious asset costs or artificial revenues.
The purchase of a new vehicle or the reduction of student loan debt are examples of short-term objectives, while retirement planning, college funding, and the purchase of a second house are examples of long-term ambitions. This is further explained below.
<h3>What are short-term savings goals?</h3>
Generally, Savings objectives, such as an emergency fund or a new smartphone, that can be accomplished in less than two years are considered short-term.
In conclusion, Examples of short-term goals include the acquisition of a new car or the reduction of outstanding debt from student loans. Long-term goals include retirement preparation, the financing of further education, and the purchase of a second home.
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