Accounting for IGCSE & O level - Accounting Procedures (Section 6 - No. 10)
If the value of a non-current asset is understated, which of the following is likely to happen?
The profit of the business will be unaffected.
The profit of the business will be overstated.
The financial position of the business will be understated.
The financial position of the business will be overstated.
Explanation
Undervalued non-current assets result in an understatement of the business's financial position.
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