1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
hjlf
3 years ago
13

At the end of the fiscal year, the usual adjusting entry to update Prepaid Rent for the portion of the benefit that was used up

/ expired was accidentally omitted. Which of the following statements is true?
a. total assets at the end of the year will be understated.
b. insurance expense will be overstated
c. stockholders' equity at the end of the year will be understated.
d. net income for the year will be overstated.
Business
1 answer:
TEA [102]3 years ago
6 0

Answer:

d. net income for the year will be overstated.

Explanation:

The prepaid rent account is used to record the amount paid in advance for rent. Once the amount is paid, the entries required are

Debit Prepaid rent

Credit Cash account

On subsequent use of the rent, the required entries are

Debit Rent expense

Credit Prepaid rent

As such where at the end of the fiscal year, the usual adjusting entry to update Prepaid Rent for the portion of the benefit that was used up / expired was accidentally omitted, net income for the year will be overstated as the rent expense that would have been posted to reduce it would have been omitted.

You might be interested in
The combination of product lines offered by a manufacturer is called the firm's:
aliina [53]

Answer:

product mix

Explanation:

The combination of product lines offered by a manufacturer is called the firm's: product mix.

7 0
1 year ago
Consider the case of the Henderson Company.
sashaice [31]

Answer:

I) Days sales outstanding (DSO) for all customers?      48.7days

= (53*0.9)+(10*0.1) = 48.7 days

II) Net sales?                                                                  $166.600

The Net sales = Gross sales - sales allowance  

The discount amount due for the 10% discount customers = 2% of the 10% of 170 mn ==>  0.02 * 0.1 * 170 ===> 0.34 mn

∴ The Net sales = 17 - 0.34 mn = 16.66 mn

   Amount paid by discount customers?                     $13.600

Explanation:

I. General Credit Policy Information

  Credit stamps                                                               2/10 Net 30

  Days sales outstanding (DSO) for all customers    48.7days

  DSO for customers who take the discount (10%)      10days

  DSO for customers who forgo the discount (90%)    53days

II. Annual Credit Sales and Costs ($ millions)

  Gross sales                                                                 $170.000

  Net sales?                                                                   $166.600

  Amount paid by discount customers                      $13.600

  Amount paid by non discounted customers           $153.000

 Variable operating costs (82% of gross sales)         $139.40

 Bad debts                                                                    $0.0

 Credit evaluation & collection costs (10% of gross sales) $17.00

7 0
3 years ago
Read 2 more answers
consumption vs. saving. Do you think these preferences are more influenced by advertisements for products that are consumable to
Sergio039 [100]

Answer:

Consumption is influenced by advertisements for products that are consumable today and savings from ads that advocate in investing tomorrow.

Explanation:

Both are important to run the circular flow of economy. If a person invests savings on a product, so there should be someone to consume it, this will help in achieving equilibrium point between aggregate demand and aggregate supply.

Increase in one shall result in decrease in other and in both cases either there will be more products to be consumed rather than the actual consumption resulting in surplus if there is excess saving or vice versa .

7 0
3 years ago
1. The most recent trends in health care expenditures may be characterized as: A. Rapidly increasing B. Far exceeding growth in
Tasya [4]

Answer:

A. Rapidly increasing

3 0
3 years ago
A favorable balance of trade exists when a country
mariarad [96]
Saves more than it spends.
5 0
3 years ago
Other questions:
  • Below are several amounts reported at the end of the year. Currency located at the company $ 675 Supplies 1,700 Short-term inves
    9·1 answer
  • Suppose the demand for good X is given by Qdx = 10 + axPx + ayPy + aMM. From the law of demand we know that ax will be: less tha
    12·1 answer
  • The article discusses three core financial implications of the business model. What are the three core financial implications, a
    14·1 answer
  • If investors expect inflation to increase over the next 20 years and the maturity risk premium is expected to increase over the
    5·1 answer
  • Cassey wished to convey a 40-acre tract of land to his two children, George and Martha, so each would own the property equally a
    5·1 answer
  • Over lunch, Daniela and Hassan are discussing their managers. Daniela describes her boss as extremely motivating. Work goals are
    14·1 answer
  • If you put $100 into a bank account that earns five percent interest per year, what is the formula you should use to determine t
    11·1 answer
  • Candle Stix estimates that 2% of the $100,000 balance in accounts receivable is uncollectible. Prior to year-end adjusting entri
    6·1 answer
  • A commitment whereby the underwriter agrees to purchase any portion of an issue offered to existing shareholders under a rights
    10·1 answer
  • Austin Power Corp., a corporation incorporated in Delaware, has recently gone bankrupt thus failing to pay its suppliers and cre
    13·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!