Use the following information for questions

-Assuming that none of the errors was detected or corrected, by what amount will 2010 income before taxes be overstated or understated?
A)$2,600 understated
B)$2,600 overstated
C)$7,400 overstated
D)$7,400 understated

Question

Use the following information for questions 
 
-Assuming that none of the errors was detected or corrected, by what amount will 2010 income before taxes be overstated or understated?
A)$2,600 understated 
B)$2,600 overstated 
C)$7,400 overstated 
D)$7,400 understated

Quizplus · Accepted Answer

The income before taxes will be overstated by $7,400 if errors are not detected or corrected, as this amount represents the net effect of the errors on the financial statements.

Use the Following Information for Questions