Jasper Company accepted a check from Harp Company as payment for services rendered.Jasper's bank statement revealed that the Harp check was an NSF check.What effect will the entry to record the NSF check have on the accounting equation of Jasper Company?

A)option A
B)option B
C)option C
D)option D

Question

Jasper Company accepted a check from Harp Company as payment for services rendered.Jasper's bank statement revealed that the Harp check was an NSF check.What effect will the entry to record the NSF check have on the accounting equation of Jasper Company?

A)option A 
B)option B 
C)option C 
D)option D

Quizplus · Accepted Answer

Recording the NSF check increases one asset (accounts receivable)and decreases another asset (cash).This results in no overall effect on total assets.There is no effect on stockholder's equity (retained earnings)since net income is not affected.

Jasper Company Accepted a Check from Harp Company as Payment