The entry to record expired insurance is omitted. This error ...

[NguyenJ]

The entry to record expired insurance is omitted. This error causes
 a. assets to be overstated.
  b. expenses to be overstated.
  c. liabilities to be overstated.
  d. liabilities to be understated.
  e. an increase in liabilities on the balance sheet.

Question 2

As per the Rev. Rul. 59-60 (Sec. 4), which of the following factors should be considered in valuations?
 
  A) the price earnings ratio of the company
  B) the earning capacity of the company
  C) the fair market value of the stock of the business
  D) the book value of stocks of similar companies

[cassie_ragen]

Answer to Question 1

A

Answer to Question 2

B
Explanation: B) Rev. Rul. 59-60 (Sec. 4 ) identifies eight valuation factors, although not all-inclusive, that should be considered, which includes the earning capacity of the company.

[NguyenJ]

Gracias!

[rachel]

Thanks for the timely response, appreciate it