APA Exam CPP-Remote Topic 7 Question 49 Discussion

Actual exam question for APA's CPP-Remote exam

Question #: 49
Topic #: 7

[All CPP-Remote Questions]

What is the effect of failing to record salaries that are earned but not paid at the end of an accounting period?

Aunderstatement of expenses for the period

Boverstatement of expenses for the period

Cunderstatement of assets for the period

Doverstatement of liabilities for the period

Show Suggested Answer

Suggested Answer: A

by Stephen at Jun 30, 2024, 09:14 AM

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Van

4 months ago

I'm scratching my head on this one. Guess I need to brush up on my accrual accounting. Oh well, time to dive into the books!

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Leota

4 months ago

D) overstatement of liabilities for the period

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Heike

4 months ago

C) understatement of assets for the period

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Tiara

4 months ago

B) overstatement of expenses for the period

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Detra

4 months ago

A) understatement of expenses for the period

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Stevie

5 months ago

B) overstatement of expenses for the period

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Lelia

5 months ago

Haha, I'm just hoping I don't get this question wrong and end up having to 'work for free' like these poor folks! D is the way to go.

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Linwood

3 months ago

D) overstatement of liabilities for the period

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Selma

3 months ago

C) understatement of assets for the period

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Makeda

3 months ago

B) overstatement of expenses for the period

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Ciara

3 months ago

A) understatement of expenses for the period

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Brett

3 months ago

D) overstatement of liabilities for the period

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Georgiann

4 months ago

C) understatement of assets for the period

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Gilma

4 months ago

B) overstatement of expenses for the period

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Ilona

4 months ago

A) understatement of expenses for the period

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Lashandra

5 months ago

I agree with Audry, not recording earned but unpaid salaries would make expenses appear lower than they actually are.

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Curt

5 months ago

I'm going with D. This is a classic accrual accounting principle. Gotta keep those books balanced, you know?

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Audry

5 months ago

A) understatement of expenses for the period

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Fabiola

5 months ago

B seems more logical to me. If you don't record the salaries, it would lead to an overstatement of expenses for the period.

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Sabrina

5 months ago

Definitely D. Unpaid salaries are liabilities that need to be recorded, so failing to do so will overstate the company's financial position.

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Annmarie

4 months ago

D) overstatement of liabilities for the period

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Lawana

4 months ago

C) understatement of assets for the period

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Craig

4 months ago

B) overstatement of expenses for the period

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Alpha

4 months ago

A) understatement of expenses for the period

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Karma

5 months ago

What is the effect of failing to record salaries that are earned but not paid at the end of an accounting period?

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Casie

5 months ago

Hmm, I think the correct answer is D. Overstatement of liabilities for the period. Unpaid salaries should be recorded as accrued liabilities.

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Paulina

5 months ago

I see your point, but I still think it's D. Overstatement of liabilities for the period.

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Delila

5 months ago

I disagree, I think the correct answer is A. Understatement of expenses for the period.

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Loise

5 months ago

No, I believe it is B. Overstatement of expenses for the period.

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Verona

5 months ago

I think the correct answer is A. Understatement of expenses for the period.

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