Question

The general journal for Wells Tech includes the entry below. Based on the information in this entry, which of the following can you determine about the corresponding general ledger entries?

Answer 1

Options:

A) The rent expense of $500 was debited to account 650 and the cash paid was credited to account 600.

B) The rent expense of $600 was debited to account 650 and the cash paid was credited to account 500.

C) The rent expense of $650 was debited to account 500 and the cash paid was credited to account 600.

D) The rent expense of $650 was credited to account 500 and the cash paid was debited to account 600.

Answer:

C) The rent expense of $650 was debited to account 500 and the cash paid was credited to account 600.

Explanation:

We can divide the journal entry into four parts:

1. Date
2. Account title: includes the accounts that are part of the transaction (rent expense and cash). It might include a short explanation of the recorded transaction.
3. Account reference: the internal code assigned to rent expense (500) and cash (600)
4. The debit / credit: includes the amounts that are included in the transaction.