Accounting for IGCSE & O level - Accounting Procedures (Section 19 - No. 17)
If the building expenses were understated by £300, and the sales are understated by £300, which is the impact on the financial statements?
Expenses will be understated
Profit will be overstated
Revenues will be overstated
No impact on the capital
Explanation
The expenses will be understated, which will impact profit. There will be no impact on capital.
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