Identify the Correct Classification for the Following Five Ledger Accounts

question 12

Multiple Choice

Identify the correct classification for the following five ledger accounts:

• A) 1 asset, 2 expense, 3 expense, 4 asset, 5 expense.
• B) 1 asset, 2 expense, 3 asset, 4 expense, 5 liability.
• C) 1 asset, 2 expense, 3 expense, 4 asset, 5 liability.
• D) 1 expense, 2 expense, 3 expense, 4 expense, 5 expense.

---

Definitions:

Mutual Mistake

A legal concept where both parties involved in an agreement have a misunderstanding regarding a critical fact of the agreement.

Reasonable Person Test

In a negligence action, the judicial standard of socially acceptable behavior; the standard used to determine the existence of apparent authority of an agent.

Meeting of the Minds

An agreement between parties on the terms of a contract, demonstrating mutual consent and understanding.

Unilateral Mistake

An error made by one party in a contract that does not affect the other party's understanding or agreement.