At the end of the fiscal year, the usual adjusting entry for depreciation on equ

Question

At the end of the fiscal year, the usual adjusting entry for depreciation on equipment was omitted. which of the folowing statements is true? O Total assets will be understated at the end of the current year O Total expenses will be overstated at the end of the current year. The balance sheet and income statement will be misstated but the Retained Earnings statement will be correct for the current year. O Net income will be overstated for the current year. Click if you would like to Show Work for this question: Open Show Work

Explanation / Answer

Net income will be overstated for the current year.

Since expense related to depreciation has been ommitted to record. it will result in decrease the expense and thus increase in net income.

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