While auditing a client you find the following entry:

Property, Plant and Equipment$ $150,000$Accounts Payable$$$ $150,000$

That payable was not paid as of year$-$end and is for repairs that should not be capitalized. What is the net effect on the following?

$$AssetsLiabilitiesOwners$$ EquityA.OverstatedOverstatedUnderstatedB.UnderstatedProperly StatedOverstatedC.OverstatedProperly StatedOverstatedD.OverstatedOverstatedProperly Stated

Multiple Choice

Option B

Option A

Option D