Question :
201.After preparing an (unadjusted) trial balance at year-end, R. Chang : 1258627
201.After preparing an (unadjusted) trial balance at year-end, R. Chang of Chang Window Company, Inc. discovered the following errors: 1. Cash payment of the $225 telephone bill for December was recorded twice. 2. Cash payment of a note payable was recorded as a debit to Cash and a debit to Notes Payable for $1,000. 3. A $900 cash dividend paid to the owner was recorded to the correct accounts as $90. 4. An additional investment of $5,000 cash by the owner was recorded as a debit to Common Stock and a credit to Cash. 5. A credit purchase of office equipment for $1,800 was recorded as a debit to the Office Equipment account with no offsetting credit entry. Using the form below, indicate whether the error would cause the trial balance to be out of balance by placing an X in either the yes or no column. Would the error cause the trial balance to be out of balance?
ErrorYesNo
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Would the error cause the trial balance to be out of balance?
202.The balances for the accounts of Milo’s Management Co., Inc. for the year ended December 31 are shown below. Each account shown had a normal balance.
Accounts payable$6,500Wages expense36,000
Accounts receivable7,000Rent expense6,000
Cash?
Office supplies1,200
Building125,000
Supplies expense21,500Land50,000
Common stock118,700Unearned management fees4,000
Management revenue175,000 Dividends48,000
Calculate the correct balance for Cash and prepare a trial balance.
203.At year-end, Henry Laundry Service, Inc. noted the following errors in its trial balance: 1. It understated the total debits to the Cash account by $500 when computing the account balance. 2. A credit sale for $311 was recorded as a credit to the revenue account, but the offsetting debit was not posted. 3. A cash payment to a creditor for $2,600 was never recorded. 4. The $680 balance of the Prepaid Insurance account was listed in the credit column of the trial balance. 5. A $24,900 van purchase was recorded as a $24,090 debit to Equipment and a $24,090 credit to Notes Payable. 6. A purchase of office supplies for $150 was recorded as a debit to Office Equipment. The offsetting credit entry was correct. 7. An additional investment of $4,000 by Del Henry was recorded as a debit to Common Stock and as a credit to Cash. 8. The cash payment of the $510 utility bill for December was recorded (but not paid) twice. 9. The revenue account balance of $79,817 was listed on the trial balance as $97,817. 10. A $1,000 cash withdrawal by the stockholder was recorded as a $100 debit to Dividends and $100 credit to cash. Using the form below, indicate whether each error would cause the trial balance to be out of balance, the amount of any imbalance, and whether a correcting journal entry is required.
Would the errorcause the trialbalance to be outof balance?Amount ofImbalanceCorrectingJournal EntryRequired
ErrorYesNoYesNo
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204.The following trial balance is prepared from the general ledger of HG’s Auto Maintenance, Inc.
HG’S AUTO MAINTENANCE, Inc.Trial BalanceOctober 31
DebitCredit
Cash$1,975
Accounts receivable2,800
Supplies500
Shop equipment13,000
Office equipment6,600
Accounts payable $4,510
Common stock 22,000
Dividends4,200
Repair fees earned 11,875
Supplies expense 8,600
Totals$37,675$38,385
Because the trial balance did not balance, you decided to examine the accounting records. You found that the following errors had been made: 1. A purchase of supplies on account for $245 was posted as a debit to Supplies and as a debit to Accounts Payable. 2. An investment of $500 cash by the owner was debited to Common Stock and credited to Cash. 3. In computing the balance of the Accounts Receivable account, a debit of $600 was omitted from the computation. 4. One debit of $300 to the Dividends account was posted as a credit. 5. Office equipment purchased for $800 was posted to the Shop Equipment account. 6. One entire entry was not posted to the general ledger. The transaction involved the receipt of $125 cash for repair services performed for cash. Prepare a corrected trial balance for the HG’s Auto Maintenance, Inc. as of October 31.
