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Wiley Question –
on the 2014 auditing book page 148, I have a question about question 2.
Which of the following is the most unexpected change on the balance sheet, if one assumes the revenue increase in 20X8 is correct?
A. Decrease in prepaid advertising expenses
B. Increase in accounts payable
C. Decrease in deferred revenues
D. Increase in common stock
The answer is A. But I chose C.
Why A is unexpected? If I debit Sales and marketing expenses and credit prepaid advertising expenses, this can prove the situation that prepaid advertising expenses can decrease while sales and marketing expenses increase.
Can anybody help me?
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