Question

The bookkeeper of Fire​ Steel, Inc. recorded a $1,566 check as $15,660 in payment of the current​ month's rent. Which of the following journal entries is needed to adjust for this error in the books of the​ company?

Answer 1

To adjust for the error in the bookkeeper's recording, a journal entry is needed to correct the payment amount. The correct entry would be a debit to Rent Expense for $15,660 and a credit to Cash for $15,660.

Step-by-step explanation:

To adjust for the error in the bookkeeper's recording, a journal entry is needed to correct the payment amount. The correct entry would be:

• Debit: Rent Expense $15,660
• Credit: Cash $15,660

This entry will decrease the Rent Expense account by $14,094 (the difference between the recorded amount and the correct amount) and increase the Cash account by $15,660 to reflect the actual payment made.