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    Accrue Expenses for Southern Company

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    Southern Company's accountant failed to accrue as of 12/31/03 some employee fringe benefit program expenses that were incurred in 2003 and that will be paid in 2004. The result of this omission is to:

    overstate 2003 net income and understate long-term liabilities at 12/31/03.
    understate 2003 expenses and current liabilities at 12/31/03.
    understate 2003 expenses and overstate current liabilities at 12/31/03.
    understate 2003 net income and overstate assets at 12/31/03.

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    https://brainmass.com/business/accounting/accrue-expenses-southern-company-96971

    Solution Summary

    The solution explains the impact of not accruing some expenses.

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