When an adjusting entry is made debiting an expense account,the credit can be made to any of the following accounts except
A)a liability.
B)a contra-asset account.
C)an asset.
D)a revenue.

Question

Quizplus · Accepted Answer

An adjusting entry debiting an expense account represents an incurred expense that was not previously recorded. The credit side of the entry should be made to an account that reflects the source of the funds used to pay for the expense. Therefore, it should not be credited to a revenue account, as revenues represent the sources of funds earned from business operations. All the other options (liability, contra-asset account, and asset) could potentially be credited depending on the circumstances of the adjustment.

When an Adjusting Entry Is Made Debiting an Expense Account,the