80.2K
Verified Solution
Link Copied!
The Colby Group has the following unadjusted trial balance as of August 31, 2016:
The debit and credit totals are not equal as a result of the following errors:
| A. | The cash entered on the trial balance was understated by $6,000. |
| B. | A cash receipt of $5,600 was posted as a debit to Cash of $6,500. |
| C. | A debit of $11,000 to Accounts Receivable was not posted. |
| D. | A return of $150 of defective supplies was erroneously posted as a $1,500 credit to Supplies. |
| E. | An insurance policy acquired at a cost of $1,200 was posted as a credit to Prepaid Insurance. |
| F. | The balance of Notes Payable was understated by $20,000. |
| G. | A credit of $4,800 in Accounts Payable was overlooked when determining the balance of the account. |
| H. | A debit of $7,000 for a withdrawal by the owner was posted as a credit to Terry Colby, Capital. |
| I. | The balance of $58,100 in Rent Expense was entered as $51,800 in the trial balance. |
| J. | Gas, Electricity, and Water Expense, with a balance of $24,150, was omitted from the trial balance. |
| | Required: |
| 1. | Prepare a corrected unadjusted trial balance as of August 31, 2016. |
| 2. | Does the fact that the unadjusted trial balance in (1) is balanced mean that there are no errors in the accounts? |
Colby Group UNADJUSTED TRIAL BALANCE 31-Aug-16 ACCOUNT TITLE DEBIT CREDIT 1Cash 2 Accounts Receivable 3 Supplies 4 Prepaid Insurance 5 Equipment 6 Notes Payable 7 Accounts Payable 8 Terry Colby, Capital 9Terry Colby, Drawing 10 Fees Earned 11|Wages Expense 12 Rent Expense 13 Advertising Expense 14 Miscellaneous Expense 15 Totals 17,300.00 37,000.00 7,400.00 1,900.00 196,000.00 97,600.00 26,000.00 129,150.00 56,000.00 454,450.00 270,000.00 51,800.00 25,200.00 5,100.00 667,700.00 707,200.00
Answer & Explanation
Solved by verified expert
