Question: Raphael Corp. incorrectly expensed a major addition to equipment when the company should have capitalized the expenditure. What are the financial statement effects in the

Raphael Corp. incorrectly expensed a major addition to equipment when the company should have capitalized the expenditure. What are the financial statement effects in the year the error was made?

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Select all that apply.

)

Multiple select question.

Expenses are understated.

Liabilities are overstated.

Assets are understated.

Net income is understated.

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