A company received a bill of $3,500 for utilities used in the current month.The journal entry to record this event:
A) will include a debit to Accounts Receivable for $3,500.
B) will include a credit to Accounts Payable for $3,500.
C) will include a credit to Utilities Expense.
D) is not required; no journal entry should be prepared until the utilities bill is paid.

Question

Quizplus · Accepted Answer

The correct entry is to debit Utilities Expense and credit Accounts Payable, as the expense has been incurred but not yet paid.

A Company Received a Bill of $3,500 for Utilities Used