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Recording the purchase of computer stationery by debiting the computer equipment account would result in?
Select ONE answer:
- An overstatement of profit and an overstatement of non-current assets
- An understatement of profit and an overstatement of non-current assets
- An overstatement of profit and an understatement of non-current assets
- An understatement of profit and an understatement of non-current assets
Show your workings to arrive at your answer, and explain and justify your reasons:
……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………
This multiple-choice question is suitable for Accounting KS5 classes.
The answer is 1
- Correct –> An expense has been posted as a non-current asset when it should have been a deduction from profit, non-current assets are overstated as a result.
- Not correct
- Not correct
- Not correct
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