A $250 payment on account was recorded as a debit to accounts receivable and a credit to accounts payable. This error will cause:
A)accounts receivable to be overstated.
B)accounts payable to be understated.
C)cash to be understated.
D)owner's equity to be overstated.

Question

Quizplus · Accepted Answer

The error causes accounts receivable to be overstated because the payment should have been credited to accounts receivable, not debited.

A $250 Payment on Account Was Recorded as a Debit