An overpayment was discovered in computing and paying the wages of a Plum Hollow Country Club employee.When the employee returns the amount of the overpayment,Plum Hollow should make which of the following entries?
A)Cash,debit; Wages Expense,credit
B)Wages Payable,debit; Wages Expense,credit
C)Wages Expense,debit; Cash,credit
D)Wages Expense,debit; Wages Payable,credit

Question

Quizplus · Accepted Answer

When the employee returns the overpayment, the company receives cash, so Cash is debited. Since the overpayment reduced the actual expense incurred, Wages Expense is credited to correct the previously recorded higher expense.

An Overpayment Was Discovered in Computing and Paying the Wages