A company made no adjusting entry for accrued and unpaid employee salaries of $9,000 on December 31.Which of the following statements is true?

A) It will have no effect on income.
B) It will overstate assets and liabilities by $9,000.
C) It will understate current-year net income by $9,000.
D) It will understate assets by $9,000.
E) It will understate current-year expenses and overstate current-year net income by $9,000.

Current-Year Net Income

Current-Year Net Income is the total profit or earnings of a company for the ongoing fiscal year, after subtracting all expenses, taxes, and costs.

Accrued Salaries

Wages that have been earned by employees but have not yet been paid by the employer.

Adjusting Entry

A journal entry made in the accounting records at the end of an accounting period to allocate income and expenditures to the period in which they actually occurred.