The documentation with the bank statement shows a debit memo for bank service charges.Based on this, what possible entry would be made in the company's accounts?
A) debit Miscellaneous Administrative Expense; credit Cash
B) debit Cash; credit Other Income
C) debit Cash; credit Accounts Payable
D) debit Accounts Payable; credit Cash

Question

Quizplus · Accepted Answer

Bank service charges are a type of administrative expense, so the entry should be a debit to Miscellaneous Administrative Expense and a credit to Cash.

The Documentation with the Bank Statement Shows a Debit Memo