If Oxbow Corporation does not record a sale made on account in December until a monthlater when the customer pays its invoice, how will Oxbow’s December financial statementsbe impacted?a. Assets will be understated on the balance sheet, while revenues will be overstated on theincome statement.b. Assets will be understated on the balance sheet, while revenues will be understated onthe income statement.c. Assets will be overstated on the balance sheet, while revenues will be overstated on theincome statement.d. Assets will be overstated on the balance sheet, while revenues will be understated on theincome statement.
If Oxbow Corporation does not record a sale made on account in December until a monthlater when the customer pays its invoice, how will Oxbow’s December financial statementsbe impacted?a. Assets will be understated on the balance sheet, while revenues will be overstated on theincome statement.b. Assets will be understated on the balance sheet, while revenues will be understated onthe income statement.c. Assets will be overstated on the balance sheet, while revenues will be overstated on theincome statement.d. Assets will be overstated on the balance sheet, while revenues will be understated on theincome statement.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
If Oxbow Corporation does not record a sale made on account in December until a month
later when the customer pays its invoice, how will Oxbow’s December financial statements
be impacted?
a. Assets will be understated on the
income statement.
b. Assets will be understated on the balance sheet, while revenues will be understated on
the income statement.
c. Assets will be overstated on the balance sheet, while revenues will be overstated on the
income statement.
d. Assets will be overstated on the balance sheet, while revenues will be understated on the
income statement.
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