In 2015, Milford Corporation determined that it overstated salaries payable and salaries expense by $20,000 in 2014.In 2015, which of the following accounts will have to be credited to correct this error?
A)Salaries and Wages Payable.
B)Salaries and Wages Expense.
C)Retained Earnings.
D)Income Summary.

Question

Quizplus · Accepted Answer

The overstatement of salaries payable and salaries expense in 2014 would have resulted in an understatement of net income and retained earnings. To correct this, Retained Earnings should be credited in 2015.

In 2015, Milford Corporation Determined That It Overstated Salaries Payable