If an adjustment for depreciation is omitted from the financial reports the effect is: Select one:...

Question

Question

Answer 1

Answer #1

Option D is the correct answer.

Depreciation adjustment carried through reducing the asset and expending the same amount through the income statement.

If depreciation adjustment omitted, there will not be any reduction on the account of assets and there is no charge on the income statement.

The result will be overstatement of the asset balance and overstatement of the profit in income statement.

Hence, Option D is correct one and this automatically eliminates remaining options since they are incorrect ones.

Answer 2

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