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Greeley [361]
3 years ago
5

On December 31, 20X1, Deal, Inc. failed to accrue the December 20X1 sales salaries that were payable on January 6, 20X2. What is

the effect of the failure to accrue sales salaries on working capital and cash flows from operating activities in Deal's 20X1 financial statements?
a. Working capital Cash flows from operating activities
b. Overstated No effect
c. Overstated Overstated
d. No effect Overstated
e. No effect No effect
Business
1 answer:
Rashid [163]3 years ago
7 0

Overstated No effect

Explanation:

In case salaries are not raised at the end of 20X1, wages owed are known, an existing obligation. Current assets minus current commitments equals working capital. Working capital is exaggerated when current liabilities are overstated.

Increasing pay in 20X1, even if it had accurately been accrued, would never have been paid at the rest of 20X1. Thus, the failure to increase salaries does not affect 20X1 operating cash flow.

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tester [92]

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SWOT analysis measures the strength, weakness, opportunities and threats of an individual/organization in the areas they operate in. Manufacturers of electric cars would see increase in gasoline prices as an opportunity, as people would want to buy more electric cars.

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4 years ago
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4 years ago
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A

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5 0
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Jarvey Corporation is studying a project that would have a ten-year life and would require a $450,000 investment in equipment wh
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Answer:

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