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8090 [49]
3 years ago
9

Ms. Garden, the company bookkeeper, recorded the annual repair costs on the company's machinery as an increase to the machinery

account. As a result, which of the following statements correctly describes this situation?
a) Assets will be overstated
b) stockholders equity will be understated
c) expenses will be overstated
d) liabilities will be overstated
Business
1 answer:
iren [92.7K]3 years ago
8 0

Answer:

a) Assets will be overstated

Explanation:

Annual repairs costs are operating expenses that should be debited to the repair and maintenance account. The amount should increase the repair and maintenance account and, consequently, expenses for that period.

If the repair expenses are debited to the asset account, assets increase in value. Since the repair costs are wrongfully posted,  the assets will be overstated. On the other hand, expenses will be understated

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3 years ago
General motors and chrysler recently experienced financial distress resulting in near bankruptcies fundamentally because
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2 years ago
Job A3B was ordered by a customer on September 25. During the month of September, Jaycee Corporation requisitioned $1,700 of dir
Rina8888 [55]

Answer:

$19,300

Explanation:

Calculation to determine the amount of job costs added to Work in Process Inventory during October

Using this formula

October Job costs=Raw material+Direct labour+Overhead

Let plug in the formula

October Job costs=$2,200+$5,700+($5,700*2)

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Therefore the amount of job costs added to Work in Process Inventory during October is $19,300

3 0
2 years ago
A manufacturer of luxury yachts would use which type of costing​ system?
GaryK [48]
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7 0
3 years ago
As a current or future business owner, entrepreneurs need to be able to assess collateral in order to secure a possible
amm1812

Answer:

True

Explanation:

Collateral is an asset used as a guarantee or security for the payment of a loan. It assures the lender that a borrower will pay back the loan.

If an entrepreneur applies for a business loan, the bank will most likely demand collateral. The entrepreneur will need to offer an asset, either property or motor vehicle, that will act as a guarantee for the loan. Should the entrepreneur fail in repayment, the bank can sell the asset to recover their money.

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