The entry to adjust salaries was done twice. This error would cause:
A) assets to be understated.
B) liabilities to be overstated.
C) revenue to be understated.
D) assets to be overstated.

Question

Quizplus · Accepted Answer

Recording the salary expense twice would increase the expense account, thereby reducing net income and increasing liabilities (salaries payable) more than they should be, leading to an overstatement of liabilities.

The Entry to Adjust Salaries Was Done Twice