A journal entry for a $290 payment to purchase office supplies was erroneously recorded as a debit to Office Supplies for $600 and a credit to Cash for $290.Which of the following statements correctly states the effect of the error on the trial balance?

Question

Quizplus · Accepted Answer

The erroneous recording resulted in an overstatement of the Office Supplies account and an understatement of the Cash account. This means that the sum of the debits (Office Supplies for $600) will exceed the sum of the credits (Cash for $290) by $310. Therefore, the correct answer is C.

A Journal Entry for a $290 Payment to Purchase Office