A Customer's Check for $1,200 Was Returned for Nonsufficient Funds

question 162

Multiple Choice

A customer's check for $1,200 was returned for nonsufficient funds.Which of the following journal entries is needed to adjust for the NSF check?

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Definitions:

Operating Income

Earnings before interest and taxes (EBIT), measuring a company's profit from its operational and regular business activities.

Fixed Costs

Expenses that do not change in relation to the volume of production or sales, such as rent, salaries, and insurance.

Operating Leverage

A measure of the relative mix of a business’s variable costs and fixed costs, computed as contribution margin divided by operating income.

Highly Automated Industries

Sectors where machines and advanced technologies preponderantly perform production and operational processes, reducing human intervention.