CPA · Question 11 · Area I: Financial Reporting
While reviewing the draft balance sheet, the controller discovers that a check for $10,000 issued to a vendor on December 30, Year 1, was recorded as a reduction of cash and accounts payable on that date. However, the check was not mailed until January 4, Year 2. What adjustment is required at December 31, Year 1?
Answer options:
No adjustment is necessary.
Debit Accounts Payable $10,000; Credit Cash $10,000.
Debit Cash $10,000; Credit Expenses $10,000.
Debit Cash $10,000; Credit Accounts Payable $10,000.
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