At the end of the day, the cash register tape shows $1,000 in cash sales but the count of cash in the register is $1,010. The proper entry to account for this excess is:
A) Debit Cash $1,010; credit Sales $1,000; credit Cash Over and Short $10.
B) Debit Cash Over and Short $10; credit Cash $10.
C) Debit Cash $1,010; credit Sales $1,010.
D) Debit Cash $1,000; credit Sales $1,000.
E) Debit Cash $1,000; debit Cash Over and Short for $10; credit Sales $1,010.

Question

Quizplus · Accepted Answer

This entry acknowledges the excess $10 in cash as a Cash Over and Short account, which is a contra asset account used to record discrepancies in cash balances. The $1,000 in cash sales is correctly credited to the Sales account, while the $1,010 debit to the Cash account reflects the actual amount of cash in the register.

At the End of the Day, the Cash Register Tape