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what is the effect on the books of an entry is not recorded? Does profit go...

what is the effect on the books of an entry is not recorded? Does profit go up or down, what happens to assets, or retained earnings?

(Its just a general response on the accounts)

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Answer #1

All the entries needs to be reported in the books of an entry of the company to reflect true and fair view. If any entries are not shown the financial position would tally but they would not give a fair view. Depending on the items not recorded the profit would be impacted that is if sales is not recorded the profit would go down, if expense is not recorded the profit would go up. Similarly, if assets are not shown assets would be understated and if liabilities are shown they would be overstated.

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