{"id":205349,"date":"2025-03-24T11:01:24","date_gmt":"2025-03-24T11:01:24","guid":{"rendered":"https:\/\/learnexams.com\/blog\/?p=205349"},"modified":"2025-03-24T11:01:26","modified_gmt":"2025-03-24T11:01:26","slug":"edison-consulting-received-a-550-utilities-bill-and-immediately-paid-it","status":"publish","type":"post","link":"https:\/\/www.learnexams.com\/blog\/2025\/03\/24\/edison-consulting-received-a-550-utilities-bill-and-immediately-paid-it\/","title":{"rendered":"Edison Consulting received a $550 utilities bill and immediately paid it"},"content":{"rendered":"\n<p>Edison Consulting received a $550 utilities bill and immediately paid it. Edison\u2019s general Journal entry to record this transaction will include a:<\/p>\n\n\n\n<p>Debit to Utilities Expense for $550.<br>Credit to Accounts Payable for $550.<br>Debit to Cash for $550<br>Credit to Utilities Expense for $550<br>Debit to Accounts Payable for $550<\/p>\n\n\n\n<p><mark style=\"background-color:rgba(0, 0, 0, 0)\" class=\"has-inline-color has-ast-global-color-6-color\"><strong>The correct answer and explanation is :<\/strong><\/mark><\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><img decoding=\"async\" src=\"https:\/\/learnexams.com\/blog\/wp-content\/uploads\/2025\/03\/image-1279.png\" alt=\"\" class=\"wp-image-205350\"\/><\/figure>\n\n\n\n<p>When Edison Consulting received a $550 utilities bill and immediately paid it, the appropriate general journal entry would be:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Debit<\/strong> Utilities Expense for $550.<\/li>\n\n\n\n<li><strong>Credit<\/strong> Cash for $550.<\/li>\n<\/ul>\n\n\n\n<p>This entry reflects the increase in expenses and the corresponding decrease in cash due to the payment.<\/p>\n\n\n\n<p><strong>Explanation:<\/strong><\/p>\n\n\n\n<p>In accrual accounting, expenses are recognized when they are incurred, not necessarily when cash is paid. Upon receiving the utilities bill, Edison Consulting has consumed services worth $550, creating an obligation to pay. By debiting the Utilities Expense account, the company acknowledges this expense, which will appear on the income statement, reducing net income. Simultaneously, crediting the Cash account decreases the company&#8217;s cash balance on the balance sheet, reflecting the payment made.<\/p>\n\n\n\n<p>This method ensures that both the expense and the cash outflow are accurately recorded in the period in which the utility services were consumed and paid for.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Edison Consulting received a $550 utilities bill and immediately paid it. Edison\u2019s general Journal entry to record this transaction will include a: Debit to Utilities Expense for $550.Credit to Accounts Payable for $550.Debit to Cash for $550Credit to Utilities Expense for $550Debit to Accounts Payable for $550 The correct answer and explanation is : When [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[25],"tags":[],"class_list":["post-205349","post","type-post","status-publish","format-standard","hentry","category-exams-certification"],"_links":{"self":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts\/205349","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/comments?post=205349"}],"version-history":[{"count":0,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts\/205349\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/media?parent=205349"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/categories?post=205349"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/tags?post=205349"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}