Adjusting Journal Entries for Current Year Accounts Receivable
Lesson:
Sometimes auditors find mistakes that need to be corrected, either because of fraud or mistakes by the original accounting team.
When revenue is underreported:
- Debit accounts receivable
- Credit revenue
- Debit revenue
- Credit accounts receivable
You're an accountant trying to implement the recommendations made by an external auditor.
Here are the relevant facts:
- An auditor reported that the accounts receivable account had been under reported by $63.00.
- The error occurred in the current year's records.
What journal entry or journal entries should be made?
Answer:
-
Accounts receivable $63.00 Revenue $63.00