If a company erroneously records a $500 deposit as $50 in its records, which of the following must occur when reconciling its bank statement?
A)The company must increase the balance per its records by $500.
B)The company must increase the balance per its records by $450.
C)The company must decrease the balance per its records by $500.
D)The company must decrease the balance per its records by $450.

Question

Quizplus · Accepted Answer

The company needs to correct the error by adding the difference between the actual deposit ($500) and the erroneously recorded amount ($50), which is $450, to its records.

If a Company Erroneously Records a $500 Deposit as $50