Question

Bertrand Inc. performed services for clients in the amount of $2,150 on credit. If this transaction had been posted in error to the Cash account instead of the Accounts Receivable account, what correcting entry would be necessary?

Multiple Choice

• Debit Fees Income $2,150; credit Cash $2,150

• Debit Cash $2,150; credit Accounts Receivable $2,150

• Debit Accounts Receivable $2,150; credit Cash $2,150

• Debit Accounts Receivable $2,150; credit Fees Income $2,150

Answer 1

The entry recorded was Debit Cash and Credit Service Revenue

The correct entry would have been to Debit Accounts Receivable and Credit Service Revenue

The correcting entry would be:

Debit Accounts Receivable $2,150; credit Cash $2,150

Option C is correct