A company was entered in hire purchase agreement and had to pay $1000 per month. Three payments were made via bank account but no entry was found in cash book. Identify the correct adjustment in cash book
A$1000 will be added to cash book balance
B$2000 will be deducted from cash book balance
C$3000 will be subtracted from cash book balance
D$3000 will be added to cash book balance
Correct answer
C. $3000 will be subtracted from cash book balance
Explanation
$3000 will be subtracted from cash book balance is the correct answer. Review the question and compare it with the other choices to remember this fact for future exams.