If a firm detects an error at the end of the year, where property taxes on the headquarters buildings was recorded as a debit to Cost of Goods Sold instead of Selling and Administrative Expenses, which of the following entries would they make?
A)correcting
B)reversing
C)closing
D)memorandum
E)t-account

Question

Quizplus · Accepted Answer

A correcting entry is needed to amend the mistake by debiting Selling and Administrative Expenses and crediting Cost of Goods Sold to move the expense to the correct category.

If a Firm Detects an Error at the End of the Year