Show how the following independent errors will affect net income on 2020. Choose if its overstated, understated and no effect Ending inventory in 2020 overstated Failed to accrue 2020 interest revenue Failed to count office supplies on hand at 12/31/20. Cash expenditures have been charged to an office supplies expense account during the year 2020 Ending inventory in 2020 understated Overstated 2020 depreciation expense; 2021 expense correct Ending inventory in 2020 overstated Failed to accrue 2020 interest revenue A capital expenditure for factory equipment (useful life, 5 years) was erroneously charged to maintenance expense in 2020 Failed to count office supplies on hand at 12/31/20. Cash expenditures have been charged to an office supplies expense account during the year 2020. Row Failed to accrue 2020 wages Ending inventory in 2020 understated Overstated 2020 depreciation expense; 2021 expense correct
Show how the following independent errors will affect net income on 2020. Choose if its overstated, understated and no effect Ending inventory in 2020 overstated Failed to accrue 2020 interest revenue Failed to count office supplies on hand at 12/31/20. Cash expenditures have been charged to an office supplies expense account during the year 2020 Ending inventory in 2020 understated Overstated 2020 depreciation expense; 2021 expense correct Ending inventory in 2020 overstated Failed to accrue 2020 interest revenue A capital expenditure for factory equipment (useful life, 5 years) was erroneously charged to maintenance expense in 2020 Failed to count office supplies on hand at 12/31/20. Cash expenditures have been charged to an office supplies expense account during the year 2020. Row Failed to accrue 2020 wages Ending inventory in 2020 understated Overstated 2020 depreciation expense; 2021 expense correct
Show how the following independent errors will affect net income on 2020. Choose if its overstated, understated and no effect Ending inventory in 2020 overstated Failed to accrue 2020 interest revenue Failed to count office supplies on hand at 12/31/20. Cash expenditures have been charged to an office supplies expense account during the year 2020 Ending inventory in 2020 understated Overstated 2020 depreciation expense; 2021 expense correct Ending inventory in 2020 overstated Failed to accrue 2020 interest revenue A capital expenditure for factory equipment (useful life, 5 years) was erroneously charged to maintenance expense in 2020 Failed to count office supplies on hand at 12/31/20. Cash expenditures have been charged to an office supplies expense account during the year 2020. Row Failed to accrue 2020 wages Ending inventory in 2020 understated Overstated 2020 depreciation expense; 2021 expense correct
Definition Video Definition Accounting method wherein the cost of a tangible asset is spread over the asset's useful life. Depreciation usually denotes how much of the asset's value has been used up and is usually considered an operating expense. Depreciation occurs through normal wear and tear, obsolescence, accidents, etc. Video
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