In Comparing the Canceled Checks on the Bank Statement with the Entries

question 194

Multiple Choice

In comparing the canceled checks on the bank statement with the entries in the accounting records,it is found that check number 2889 for December's utilities was correctly written and drawn for $970 but was erroneously entered in the accounting records as $790.The journal entry to adjust the books for the bank reconciliation would include which of the following for this situation?

• A)$180 decrease to Cash and a $180 decrease to Utility Expense
• B)$180 increase to Cash and a $180 increase to Utility Expense
• C)$180 decrease to Cash and a $180 increase to Utility Expense
• D)$180 increase to Cash and a $120 decrease to Utility Expense
• E)$970 increase to Cash and a $790 decrease to Utility Expense

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Definitions:

Competitive Factor Market

A market for inputs where firms purchase resources necessary for production, characterized by many sellers and buyers.

Inframarginal Workers

Employees whose productivity and wage are above the minimum required for employment, but are not the highest performers.

Marginal Expenditure Curve

A graph that shows the additional cost of purchasing one more unit of a good or service.

Labor Supply Curve

The graphical representation of the relationship between different levels of wage and the quantity of labor willing to be supplied.