A Check Payment for $658 Was Incorrectly Entered in the Cash

question 25

Multiple Choice

A check payment for $658 was incorrectly entered in the Cash account as $856.Which of the following adjustments 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:

Gross Accounts Receivable Approach

A method that estimates the total amount to be received from customers, without deducting expected bad debts.

Unadjusted Year End

The fiscal year-end date prior to any adjustments made for accounting purposes.

Trial Balance

A bookkeeping worksheet in which the balances of all ledgers are compiled into debit and credit account column totals that are equal, used to ensure the accounting system's mathematical accuracy.

Allowance for Uncollectibles

An estimation of the accounts receivable that a company does not expect to collect, used to adjust financial statements.