Which of the Following Errors Would Cause the Trial Balance

question 92

Multiple Choice

Which of the following errors would cause the trial balance to be out of balance?

• A) The payment of utilities expense was recorded as a debit to Rent Expense for $97 and a credit to Cash for $97.
• B) The payment of an account payable for $100 was recorded as a debit to Cash, $100, and a credit to Accounts Payable, $100.
• C) The collection of an account was not recorded.
• D) The payment of an account payable for $700 was recorded as a debit to Accounts Payable for $700 and a credit to Cash for $7,000.

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Definitions:

Market Price

The existing rate at which an asset or service can be sold or bought.

Convertible Bond

A type of bond that can be converted into a predetermined number of shares of the issuing company's stock at certain times during its life, usually at the discretion of the bondholder.

Conversion Price

The predetermined price at which convertible securities (like convertible bonds or preferred shares) can be converted into the issuing company's common stock.

Treasury Bills

Short-term government securities with maturities of one year or less sold at a discount from their face value.