Accounting for IGCSE & O level - Accounting Procedures (Section 26 - No. 26)
If a company paid $1,000 for office supplies and recorded it as a purchase of inventory, what would be the effect on the trial balance?
The trial balance would be out of balance.
The trial balance would still balance.
Purchases would be understated.
Office Supplies would be overstated.
Explanation
The trial balance would still balance as there is a debit and a credit.
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