A debit to an expense account was posted as a debit to a revenue account.This error would cause:
A)assets to be overstated.
B)liabilities to be overstated.
C)revenue to be understated.
D)None of the above is correct.

Question

Quizplus · Accepted Answer

If a debit to an expense account is posted as a debit to a revenue account, it will cause revenue to be understated. This is because expenses decrease revenues, so if an expense is incorrectly recorded as a revenue, the revenue will appear lower than it actually is. Assets and liabilities are not affected by this error.

A Debit to an Expense Account Was Posted as a Debit