From the bank reconciliation,no entry was recorded for a debit memo for a new check fee expense.This would cause:
A)liabilities to be understated.
B)liabilities to be overstated.
C)expenses to be understated.
D)expenses to be overstated.

Question

Quizplus · Accepted Answer

If the debit memo for a new check fee expense was not recorded, it means that the expense was omitted from the books. This would result in expenses being understated, as they would not reflect the actual amount paid for the new check fee. There would be no impact on liabilities, as the expense is a direct reduction of retained earnings (or an increase in accounts payable if not yet paid).

From the Bank Reconciliation,no Entry Was Recorded for a Debit