On July 7, 2020, Rancho Realty Co. performed cash services of $1,900. To record this transaction Rancho would

Question

Quizplus · Accepted Answer

Cash services performed means the receipt of cash, therefore, the account that would be debited is Cash. Option A is incorrect because Service Revenue would be credited for $1,900. Option B is incorrect because Accounts Receivable would only be credited if Rancho Realty Co. expected to receive the cash at a later date. Option D is incorrect because Accounts Payable is a liability account and would only be credited if Rancho Realty Co. owed money to another party.