Accounting for IGCSE & O level - The Fundamentals Of Accounting (Section 30 - No. 43)
What is the impact of not recording an accrual of expense?
Overstatement of both profits and assets.
Understatement of both profits and liabilities.
Overstatement of both profits and liabilities.
Understatement of both profits and assets.
Explanation
Failing to record an accrual of expense will understate expenses and overstate profits, and it will also lead to understating liabilities.
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