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A Company's Accountant Capitalized a Payment That Should Be Recorded

Question 76

Multiple Choice

A company's accountant capitalized a payment that should be recorded as a revenue expenditure. How will this error affect the financial statements of the company?


A) Net income will be understated.
B) Expenses will be overstated.
C) Assets will be overstated.
D) Liabilities will be overstated.

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