A company receives a utility bill each month for services received. The company's policy is to pay the utility bill within 30 days of receipt. On December 31, 2021, the company receives a utility bill of $4,200 for the month of December and plans to pay the bill by January 30, 2022. What adjusting entry, if any, will the company record on December 31, 2021?
A) Debit Utilities Expense and credit Cash for $4,200.
B) Debit Utilities Expense and credit Utilities Payable for $4,200.
C) Debit Utilities Payable and credit Utilities Expense for $4,200.
D) No adjusting entry is necessary at the end of the year.
Answer: B
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Accounting
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