If the adjustment for accrued salaries at the end of the period is inadvertently omitted, both liabilities and owner's equity will be understated for the period.

Question

Quizplus · Accepted Answer

If the adjustment for accrued salaries is omitted, it means that the salaries expense for the period has not been recorded and therefore both the liabilities (accrued salaries payable) and owner's equity (net income) will be understated.

If the Adjustment for Accrued Salaries at the End of the Period