Which of the Following Errors Would Cause the Debit Side

question 18

Multiple Choice

Which of the following errors would cause the debit side of a trial balance to be larger than the credit side?

• A)Revenue earned on account was recorded with a debit to Cash and a credit to Revenue.
• B)Purchase of supplies on account was recorded with a credit to Supplies and a debit to Accounts Payable.
• C)Land purchased with cash was recorded with a debit to the Land account and a credit to Accounts Payable.
• D)None of these answer choices would cause the debit side of the trial balance to be larger than the credit side.

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Definitions:

Discount Rate

The interest rate used to discount future cash flows to their present value, often used in the context of evaluating investment opportunities.

WACC

Weighted Average Cost of Capital, a calculation of a firm's cost of capital wherein each category of capital is proportionately weighted.

Risk Similarity

The degree to which different investments share similar risk characteristics.

Current Operations

The day-to-day activities involved in running a business, such as sales, maintenance, and administration, which directly relate to its main activities.