Multiple Choice
In 20X2, Gamma Company made an ordinary repair to a delivery truck at a cost of $300. Gamma's accountant debited the asset account, Delivery Vehicles. Was this treatment an error, and if so, what will be the effect on the financial statements of Gamma?
A) The repair was accounted for correctly.
B) The error increased assets and profit in 20X2.
C) In the years following 20X2, net income will be too high.
D) The error decreased profit in 20X2.
Correct Answer:
Verified
Correct Answer:
Verified
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