In: Accounting
Bertrand Inc. performed services for clients in the amount of $1,450 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:
1. Debit Accounts Receivable $1,450; credit Fees Income $1,450
2. Debit Accounts Receivable $1,450; credit Cash $1,450
3. Debit Fees Income $1,450; credit Cash $1,450
4. Debit Cash $1,450; credit Accounts Receivable $1,450
Solution:
Correcting entry would be:
Debit Accounts Receivable..............$1,450
Credit Cash............................................................$1,450
Hence option "2" is correct.