An NSF check returned by the bank should be entered in the depositor's accounting records by a debit to:
A)Accounts Receivable.
B)An expense account.
C)Cash.
D)Cash Over and Short.

Question

Quizplus · Accepted Answer

An NSF check means that the depositor did not receive the money owed to them, so it's essentially a bad debt. The amount of the check should be debited to the Accounts Receivable account, which represents the amount owed to the depositor.

An NSF Check Returned by the Bank Should Be Entered