Failure to adjust for depreciation results in the overstatement of assets and the understatement of net income.

Name: Failure to adjust for depreciation results in the overstatement of assets and the understatement of net income.
Brand: Quizplus
Rating: 4.9 (41 reviews)

Question

Quizplus · Accepted Answer

Failure to adjust for depreciation results in the overstatement of assets but also results in the overstatement of net income, not understatement, because expenses are not properly accounted for, leading to higher reported profits.

Failure to Adjust for Depreciation Results in the Overstatement of Assets