Adjusting Entry Mistakes: (Part 1) Overstating and Understating Expenses || Business Debunked

When companies fail to make proper adjusting entries, all hell breaks loose (well... kind of). This video explains how overstating or understating expenses impacts a company's net income and retained earnings over multiple periods. This video was produced in partnership with the UBC Sauder School of Business. 🛌 Related Videos 🛌 For a refresher:    • What are Prepaid Expenses || Business Debu...   To review the basics:    • What is Accrual Accounting? Part 2: Expens...   To keep learning:    • Adjusting Entry Mistakes: (Part 2) Oversta...   * * * * 0:00 Intro to over and understatement of expenses 1:18 Understating expenses: forgetting to record an expense 2:10 Understating expenses: forgetting to adjust a prepaid expense 2:43 Understating expenses: long-term impact on financial statements 6:04 Overstating expenses: recording an asset as an expense 7:17 Overstating expenses: long-term impact on financial statements 8:26 Summary and takeaways * * * * 🛌 Special Thanks To 🛌 Scripting and Filming by Maddie Zapach Animating and Editing by Arkie Liu Advising by Dr. Xin Zheng For more information, please contact businessdebunked@gmail.com * * * * 🛌 Sound FX Used 🛌 Free sound effects from https://www.fesliyanstudios.com Additional sound effects from https://www.zapsplat.com Spoiler alert clip from    • Видео   (we do not own the rights to this clip) 🛌 Images Used 🛌 Muffin icon isolated on white background vector image designed by mary_stocker; Jam vector image designed by iadamson; Realistic paper napkin box isolated on white vector image designed by BQStudio; Metal chain seamless pattern metallic industrial vector image designed by vikivector; Cartoon round-the-clock boutique vector image designed by vectorpocket; Jeans vector image designed by alegria111; Floral antlers vector image designed by relato; Expert advice vector image designed by Liubomir; Consultant Gold Vintage Label vector image designs by mushan; Cute cartoon beaver waving with his hands vector image designed by Novitskiy1980; Car insurance policy finance form money concept vector image designed by kolonko; Interior background of modern men clothing store vector image designed by littleartvector; Interior scene of modern beauty salon vector image designed by littleartvector; Crowdfunding money pack and golden coins vector image designed by robuart; Walking white goose vector image designed by hennadii; Stop road sign vector image designed by roxiller at https://www.vectorstock.com * * * * This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License. For more information, please visit creativecommons.org/licenses/by-nc-nd/4.0/ 🛌 Thank YOU For Watching 🛌