An accountant has debited an account for $3,500 and credited a liability account for $2,000. Which of the following would be an incorrect way to complete the recording of this transaction?
A) Credit another asset account for $1,500.
B) Credit another liability account for $1,500.
C) Credit an expense account for $1,500.
D) Credit the owner's capital account for $1,500.
E) Debit another asset account for $1,500.

Question

Quizplus · Accepted Answer

The total debits and credits must balance in a transaction. Since the accountant has already debited an account for $3,500 and credited a liability account for $2,000, the remaining $1,500 must be credited (not debited) to another account to balance the transaction. Choices A, B, C, and D correctly suggest crediting another account, while E incorrectly suggests debiting, which would unbalance the transaction.

An Accountant Has Debited an Account for $3,500 and Credited