A Company Made No Adjusting Entry for Accrued and Unpaid

Multiple Choice

A company made no adjusting entry for accrued and unpaid employee wages of $28,000 on December 31. This oversight would:

A) Overstate assets by $28,000.
B) Have no effect on net income.
C) Understate net income by $28,000.
D) Overstate net income by $28,000.
E) Understate assets by $28,000.