What would be the effect on the income statement if the adjustments for unbilled fees and accrued wages were omitted at the end of the year?

Over$/$Understated

Amount

Fees earned Understated Correct

$$11,150\mathrm{.}00$

Wages expense Understated Correct

$$4,840\mathrm{.}00$

Net income Understated Correct

$

Points:

$5/6$

Check My Work

$2.$ Half of the effect will occur on the income statement if there is an omission and the other half will occur on the balance sheet. What would overstatements or understatements of net income result from?

$3.$ What would be the effect on the balance sheet if the adjustments for unbilled fees and accrued wages were omitted at the end of the year?

Over$/$Understated

Amount

Accounts receivable Understated Correct

$$11,150\mathrm{.}00$

Total assets Understated Correct

$

Wages payable Understated Correct

$

Total liabilities Understated Correct

$

Owner's capital Understated Correct

$

Total liabilities and owner's equity Understated Correct

$

Points:

$7/12$

Check My Work

$3.$ Half of the effect will occur on the income statement if there is an omission and the other half will occur on the balance sheet. Regarding effects of errors on the balance sheet, the accounting equation is a guide.

$4.$ What would be the effect on the $$Net increase or decrease in cash$$ on the statement of cash flows if the adjustments for unbilled fees and accrued wages were omitted at the end of the year?No effect Correct

Points:

$1/1$

Check My Work

$4.$ What effect do adjusting entries have on cash?