If the Bookkeeper Forgot to Record a Credit to Accounts

question 23

Multiple Choice

If the bookkeeper forgot to record a credit to accounts receivable:

• A) the trial balance would still balance.
• B) debits would exceed credits on the trial balance.
• C) credits would exceed debits on the trial balance.
• D) total debits and total credits would both be incorrect on the trial balance.

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Definitions:

Non-Monetary Items

Items on the balance sheet not easily converted to cash, often valued at historical cost, such as property, plant, and equipment.

Functional Currency

The currency of the primary economic environment in which the entity operates, typically used in the preparation of financial statements.

Closing Values

The final price at which a security is traded on a given trading day, used for financial reporting and analysis.

Contributed Capital

Funds that shareholders invest in a company by purchasing shares directly from the company.