JAMB Accounting 2016 Objective — Question 17
Question 17 of 40 from the Joint Admissions and Matriculation Board (JAMB) Accounting 2016 Objective paper, with the correct answer and a full explanation.
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17. The effect of overstating revenue expenditure in the profit and loss account is that the (a) opening stock will be increased (b) net profit will be understated (c) net profit will be overstated (d) opening stock will be decreased
- A. opening stock will be increased
- B. net profit will be understatedCorrect
- C. net profit will be overstated
- D. opening stock will be decreased
Explanation
When expenditures are overstated in the profit and loss account, the net profit for the period will be understated.
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