Assuming that none of the errors were detected or corrected, by what amount will 2020 income before taxes be overstated or understated?
A) $28,600 understated
B) $23,800 understated
C) $13,400 understated
D) $13,400 overstated

Question

Quizplus · Accepted Answer

The error is an understatement of depreciation expense. This means that the net income is overstated by the amount of the understatement. The depreciation expense is $28,600, so the net income is overstated by $28,600.

Assuming That None of the Errors Were Detected or Corrected