If a company capitalizes costs that should be expensed,how is its income statement for the current period impacted?
A)Net income will be lower than it should be.
B)Revenues will be lower than they should be.
C)Expenses will be lower than they should be.
D)Assets will be lower than they should be.

Question

Quizplus · Accepted Answer

When costs that should be expensed are capitalized, expenses are understated, leading to higher net income for the current period.

If a Company Capitalizes Costs That Should Be Expensed,how Is