Exeter is a building contractor on the Gulf Coast After losing a number of big lawsuits, it was facing its first annual net loss as the end of the year approached. The owner, Hank Snow, was under intense pressure from the company's creditors to report positive net income for the year. However, he knew that the controller, Alice Li, had arranged a short-term bank loan of $10,000 to cover a temporary shortfall of cash. He told Alice to record the Incoming cash as 'construction revenue" instead of a loan. That would nudge the company's income into positive territory for the year, and then, he said, the entry could be corrected in January when the loan was repaid. How would this action affect the year-end Income Statement and Balance Sheet? O A. The Net Income would be overstated and Liabilities would be understated. OB. The Net Income would be overstated and the Assets would be overstated. OC. The Net Income would be understated and Assets would be understated. OD. The Net Income would be understated and Liabilities would be understated. If you were one of the company's creditors, how would this fraudulent action affect you? OA. This action would make the company appear to be in worse shape financially nit really is, causing me to deny loans to this company unfairly. OB. I would view this as good financial management and want to do more business with this company. O c. This action would make the company appear to be in better shape financially than it really is, possibly leading me to put myself at more risk by extending credit to the company. OD. It would not affect me. Click to select your answer and then click Check Answer. ? All parts showing Clear All Check