Of the Following Errors, Which One by Itself Will Cause

question 30

Multiple Choice

Of the following errors, which one by itself will cause the trial balance to be out of balance?

• A) A $200 cash salary payment posted as a $200 debit to Cash and a $200 credit to Salaries Expense.
• B) A $100 cash receipt from a customer in payment of his account posted as a $100 debit to Cash and a $10 credit to Accounts Receivable.
• C) A $75 cash receipt from a customer in payment of his account posted as a $75 debit to Cash and a $75 credit to Cash.
• D) A $50 cash purchase of office supplies posted as a $50 debit to Office Equipment and a $50 credit to Cash.
• E) An $800 prepayment from a customer for services to be rendered in the future was posted as an $800 debit to Unearned Revenue and an $800 credit to Cash.

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Definitions:

Annuity

A financial service that offers a continual payment stream to its holder, primarily aimed at funding the post-retirement life of individuals.

Compounded Semiannually

Interest that is calculated and added to the principal twice a year, leading to interest on interest.

Present Value

The contemporary value of a future monetary sum or cash flow stream, calculated with a set rate of return.

Compounded Semi-annually

The process of adding interest to the principal sum of a deposit or loan every six months, so that each subsequent interest calculation is based on the original principal plus all accumulated interest.