Year-end net assets would be overstated and current expenses would be understated as a result of failure to record which of the following adjusting entries?
A)Expiration of prepaid insurance
B)Depreciation of fixed assets
C)Accrued wages payable
D)All of these

Question

Quizplus · Accepted Answer

Failure to record any of these adjusting entries results in overstating the year-end net assets and understating current expenses. The prepaid insurance and fixed assets are assets and if not adjusted, the assets will be overstated. The accrued wages payable is a liability and if not adjusted, the expenses will be understated.

Year-End Net Assets Would Be Overstated and Current Expenses Would