Accounting for IGCSE & O level - Accounting Procedures (Section 27 - No. 25)
If a company incorrectly treats a capital expenditure as a revenue expenditure, how will it impact the financial statements?
Assets will be overstated, and profit will be understated.
Assets will be understated, and profit will be overstated.
Assets will be understated, and profit will be understated.
Assets will be overstated, and profit will be overstated.
Explanation
The asset will not be recorded, and expense will be recorded which will lead to decrease in profit.
Comments (0)
