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AleksAgata [21]
3 years ago
5

The entry to record the issuance of a note for cash was recorded with a debit to Cash and a credit to Notes Receivable. The effe

ct of recording this entry causes: Select one: A. stockholders' equity to be understated. B. assets to be understated. C. liabilities to be overstated. D. stockholders' equity to be overstated.
Business
1 answer:
dybincka [34]3 years ago
6 0

Answer:

B) assets to be understated.

Explanation:

The correct journal entry should have been:

Dr Cash XX

    Cr Notes payable XX

Instead, the following entry was made:

Dr Cash XX

    Cr Notes receivable XX

Since notes receivable is an asset and it is wrongfully decreased, assets will be understated. Since notes payable is a liability and it is not recorded. liabilities will also be understated.

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Answer:

C) $650,000

Explanation:

Government entities should record their assets at fair market value, not at cost basis. They should also include the land improvements as part of the total value of the land:

total value of the land = $500,000 (donated land) + $150,000 (land improvements) = $650,000

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3 years ago
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WHEN A TRAFFIC SIGNAL LIGHT IS NOT WORKING, YOU SHOULD:
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4 years ago
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Because of an accident Royce was involved in, his insurance company has increased his annual premium for auto insurance by 5. 2%
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Premium is often paid by people based on some kinds of services offered.

From the picture attached, we can see Royce' premiums for the previous year, which were;

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2 years ago
What is an indicator of increased economic growth in a nation?
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Answer: The gross domestic product.

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