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)Overstating 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 is not a method used to overstate assets. In fact, this method may actually understate the value of the assets. The other options (A, C, and D) are all methods used to overstate assets.

Which Method Is NOT Used to Overstate Assets