Accounting 0452 · IGCSE · Accounting principles

Accounting principles — practice question

When the financial year finished, a manufacturing business still had rent outstanding for its factory. It then made an adjustment to its financial statements to reflect this. What effects did this adjustment have?

  • Aprime cost decrease, cost of production decrease, gross profit increase
  • Bprime cost no effect, cost of production increase, gross profit decrease
  • Cprime cost no effect, cost of production no effect, gross profit decrease
  • Dprime cost increase, cost of production increase, gross profit decrease

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