A $4,500 payment for Rent Expense was incorrectly journalized and posted as a debit to Rent Expense for $5,400 and a credit to Cash for $5,400. The correcting entry, using the one-step method, would include a
A) debit to Cash for $900.
B) credit to Rent Expense for $4,500.
C) credit to Rent Expense for $5,400.
D) credit to Cash for $90.

Question

Quizplus · Accepted Answer

The error resulted in an overstatement of both Rent Expense and Cash by $900 ($5,400 - $4,500). To correct this, Cash should be debited (increased) by $900 to offset the previous overstatement.

A $4,500 Payment for Rent Expense Was Incorrectly Journalized and Posted