Accounting for IGCSE & O level - Accounting Procedures (Section 3 - No. 25)
What impact will the omission of drawings of $3,000 have on the financial statements?
Profit unaffected; Capital understated by $3,000.
Profit understated by $3,000; Capital unaffected.
Profit overstated by $3,000; Capital understated by $3,000.
Profit understated by $3,000; Capital understated by $3,000.
Explanation
Profit is unaffected while capital is understated by $3,000.
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