At year-end a trial balance prepared shows total credits exceed total debits by $855. This discrepancy could have been caused by a. An error in the general journal where an increase of $855 in accounts payable was recorded as a decrease of $855 in accounts payable. b. The ledger balance of accounts receivable was wrongly entered in the trial balance as 95 instead of $950. c. The ledger balance for accounts payable of $8,550 entered in the trial balance as $855. $855 increase in accounts receivable was recorded as a $855 increase in cash in general journal. d.
Bad Debts
At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
![At year-end a trial balance prepared shows total credits exceed total debits by $855. This
discrepancy could have been caused by
a. An error in the general journal where an increase of $855 in accounts payable was
recorded as a decrease of $855 in accounts payable.
b. The ledger balance of accounts receivable was wrongly entered in the trial balance as
95 instead of $950.
c. The ledger balance for accounts payable of $8,550 entered in the trial balance as $855.
d. $855 increase in accounts receivable was recorded as a $855 increase in cash in general
journal.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fa1aca178-9e0f-49a2-bfde-2e931fa218f6%2F2e79a9a8-b37b-45f4-930a-9e492057725f%2Fi9f5g7j_processed.png&w=3840&q=75)
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