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A $300 Receipt of Cash on Account Was Recorded as a $500

Question 120

Multiple Choice

A $300 receipt of cash on account was recorded as a $500 debit to cash and a $500 credit to accounts receivable. This error will cause:


A) cash to be overstated $200.
B) cash to be understated $500.
C) cash to be understated by $800.
D) accounts receivable to be overstated $500.

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