Reference no: EM132659760

Problem 1: Failure to make an adjusting entry to recognize utilities payable would cause which of the following?

A. An understatement of liabilities, net income, and stockholders' equity.

B. An understatement of liabilities and an overstatement of net income and stockholders' equity.

C. No effect on assets, liabilities, net income, or stockholders' equity.

D. An overstatement of liabilities, net income, and stockholders' equity.

E. An understatement of liabilities and net income and an overstatement of stockholders' equity.