Throughout the Current Year, Chan Company Treated Sales Taxes Paid

Multiple Choice

Throughout the current year, Chan Company treated sales taxes paid on purchases of PPE assets as revenue expenditures. As a result, the current year's:

A) Profit is overstated.
B) Revenue is overstated.
C) Depreciation expense is understated.
D) None of the above; payments of sales taxes should be treated as revenue expenditures.