A $75 Payment for Rent Expense Was Posted as a Debit

question 28

Multiple Choice

A $75 payment for rent expense was posted as a debit to salary expense and a credit to cash. This error will cause:

• A)the trial balance to be in balance.
• B)the sum of the credits to exceed the sum of the debits by $75.
• C)the sum of the debits to exceed the sum of the credits by $75.
• D)the sum of the debits to exceed the sum of the credits by $150.

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Definitions:

Growth Opportunities

Potential scenarios or investments that could lead to an increase in business scale, revenue, or profits.

No-growth Value

The value of a company assuming that it will not experience any future growth in earnings or dividends.

GAAP

Generally Accepted Accounting Principles; the standard framework of guidelines for financial accounting used in any given jurisdiction.

Leeway

The amount of freedom to move or act that is available; in finance, it often refers to the flexibility allowed in making investment decisions or adjustments.