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The failure to record an accrued expense will result in overstatement of?

<p>A. Working Capital</p> <p>B. Expenses</p> <p>C. Assets</p>

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تم إضافة السؤال من قبل Altaf Bhoon ACA , Assistant Finance Manager , Atlantic Maritime Group FZE
تاريخ النشر: 2014/11/25
Shahbaz Hayder
من قبل Shahbaz Hayder , Group Head of Finance , Sharif Group of Companies

Expense is understated as

 

You are missing this entry

 

Expense (Dr)

Accrued Expense (Cr)

 

By ignoring expense, you are understating them.

 

Answer A is right.

Divyesh Patel
من قبل Divyesh Patel , Assistant Professional Officer- Treasury , City Of Cape Town

Option B

Alaa Gharieb Ahmed Ahmed Abou-Eita
من قبل Alaa Gharieb Ahmed Ahmed Abou-Eita , Finance & Administrative Manager , Arab Media Investments Company

b

Muzaffar  Hussain
من قبل Muzaffar Hussain , Senior Accountant , International Knee and Joint Centre LLC

A is correct Answer, on based on equation (Working capital = current assets - current liabilities)

Asif Pyarali (CMA finalist)
من قبل Asif Pyarali (CMA finalist) , Manager Finance and Export , Amlani Enterprises

A is the right answer because failure to record accrued expense means liability is not entered in journal hence working capital will appreciate. Note: Working capital = Current Aseest - Current liability.

Lesley Lanag CMA CPA
من قبل Lesley Lanag CMA CPA , Senior Accountant , Takaful Emarat Insurance (P.S.C)

Accrued expense is a payable. Non recognition of such will result to understatement of payable and overstatement of working capital, hence my answer is A. Remember that working capital is current asset less current liability. 

Saifullah Shirazi
من قبل Saifullah Shirazi , Senior Accountant , Suraj Cotton Mills Limited

A is the right anwer

Ahmed kandil
من قبل Ahmed kandil , Cost Controller , Battour Holding Cpompany

correct answer is b 

Ayman Mohamed Abdelmoaty
من قبل Ayman Mohamed Abdelmoaty , Senior Accountant , Health Assurance Hospitals Co. - Dhaman

Because working capital =current liabilties

مستخدم محذوف‎
من قبل مستخدم محذوف‎

b - is the answer

 

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