A credit to an asset account was posted to a revenue account. This error would cause
A) assets to be overstated.
B) revenue to be overstated.
C) expenses to be overstated.
D) Both A and B are correct.

Question

Quizplus · Accepted Answer

A credit to an asset account decreases the asset balance, but if it's mistakenly posted to a revenue account, it increases revenue. Thus, assets are understated (not overstated), and revenue is overstated.

A Credit to an Asset Account Was Posted to a Revenue