A cash payment of $130 on account was recorded as a $310 debit to Accounts Payable and a $310 credit to Cash. The necessary correcting entry is

Question

Quizplus · Accepted Answer

The correct entry should reverse the incorrect entries by debiting the correct account (Cash) for the correct amount ($130) and crediting the incorrect account (Accounts Payable) for the same amount ($130). This will result in a decrease to the original credit to Cash and a decrease to the original debit to Accounts Payable. Option C correctly identifies this necessary adjustment.

A Cash Payment of $130 on Account Was Recorded as a $310