At the end of 2010 it is discovered that the accountant for Gower Company failed to record $60,000 of interest payable which had accrued since the last interest payment date. The current ratio, quick ratio, and debt ratio, as well as the financial statements, had already been computed using the erroneous data. Correction of the accounting records will have which of the following effects?
A) Net income as formerly computed will not be affected by the correction of the error.
B) The interest coverage ratio as formerly computed will not change as a result of the correction.
C) The debt ratio as formerly computed will decrease as a result of the correction.
D) The quick ratio as formerly computed will decrease as a result of the correction.

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The Answer of At the end of 2010 it is discovered that the accountant for Gower Company failed to record $60,000 of interest payable which had accrued since the last interest payment date. The current ratio, quick ratio, and debt ratio, as well as the financial statements, had already been computed using the erroneous data. Correction of the accounting records will have which of the following effects?
A) Net income as formerly computed will not be affected by the correction of the error.
B) The interest coverage ratio as formerly computed will not change as a result of the correction.
C) The debt ratio as formerly computed will decrease as a result of the correction.
D) The quick ratio as formerly computed will decrease as a result of the correction.

At the End of 2010 It Is Discovered That the Accountant