Which method is NOT used to overstate assets?
A)Inappropriately capitalizing costs that should be expensed.
B)Recording newly acquired assets at cost instead of fair market value in a healthy economy.
C)Creating ficticious accounts receivable or inventory to hide thefts.
D)Inflating assets through mergers and acquisitions by manipulation of intercompany accounts and transactions.

Question

Quizplus · Accepted Answer

Recording newly acquired assets at cost instead of fair market value in a healthy economy would actually understate the value of assets, not overstate them. Choices A, C, and D are all methods that can be used to overstate assets.

Which Method Is NOT Used to Overstate Assets