If an employee steals cash from a company and tries to cover up his/her actions by recording a fictitious debit to Insurance Expense and a credit to Cash, then

Question

Quizplus · Accepted Answer

Recording a fictitious debit to Insurance Expense and a credit to Cash will result in overstating the expenses. The expense account (Insurance Expense) will be overstated, and the cash balance will remain unchanged as it is a fictitious entry. Therefore, the correct option is A.

If an Employee Steals Cash from a Company and Tries