At the end of the current year, a company overstated prepaid insurance by $72,000 and understated supplies

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At the end of the current year, a company overstated prepaid insurance by $72,000 and understated supplies expense by $103,000. Its effective tax rate is 35%. As a result of this error, net income is:

a. Understated by $113,750.

b. Overstated by $20,150.

c. Overstated by $113,750.

d. Understated by $20,150.

Related Book For answer-question

Canadian Income Taxation planning and decision making

ISBN: 9781259094330

17th edition 2014-2015 version

Authors: Joan Kitunen, William Buckwold

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Posted Date: Oct 11, 2018 07:01 AM

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At the end of the current year, a company overstated prepaid insurance by $72,000 and understated supplies

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c Overstated by 113750 14 overstated ... View the full answer

Canadian Income Taxation planning and decision making

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