Check Payment for $658 Was Incorrectly Entered in the Cash

question 59

Multiple Choice

Check payment for $658 was incorrectly entered in the cash account as $856. Which adjustment needs to be made?

• A)decrease the book balance
• B)decrease the bank statement balance
• C)increase the book balance
• D)increase the bank statement balance

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Definitions:

Unearned Management Fees

Income received by a business for services that have not yet been rendered, considered a liability until the service is provided.

Management Fees Revenue

Income earned by a company for providing managerial services, which can include advisory, administrative, or general management services.

End-of-Period Adjustment

Adjustments made to the financial records at the end of an accounting period to ensure they accurately reflect the company's financial status.

Prepaid Expense

Expenditures paid in advance for goods or services to be received in the future, treated as an asset on the balance sheet until used.