Merriweather Post Pavillion received a $820 check from a customer for the balance due.The transaction was erroneously recorded as a debit to Cash $280 and a credit to Service Revenue $280.The correcting entry is

Question

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The original entry recorded only $280, which means that $540 ($820 - $280) was not recorded. The correcting entry should debit Cash $820, which accounts for the full amount received, and credit two accounts: Service Revenue and Accounts Receivable. Since the original entry recorded Service Revenue, it should be credited $280. The remaining $540 should be credited to Accounts Receivable to reflect the customer's payment. Therefore, the correcting entry is debit Cash, $820; credit Service Revenue, $280 and Accounts Receivable, $540. The only option that matches this entry is C.

Merriweather Post Pavillion Received a $820 Check from a Customer