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New Member
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Feb 5, 2007, 09:00 PM
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Correcting a trial balance
I seem to be having trouble correcting a trial balance. Please help. Thanks.
Question 1: A debit posting to Wages Expense of 670 dollars was omitted.
So do I now credit or debit Waged Expense?
Question 2: A payment of 65 dollars for telephone charges was recorded as a debit to Office Expense for 65 dollars and a debit to Cash for 65 dollars.
It should be a credit to Cash and a debit to O.E. right?
Question 3: A dividend of 575 dollars was debited to Wages Expense for 575 and credited to cash for 575. What should I do now?
Question 4: Cash received from a customer on account was debited for 570 dollars and Accounts Rec. waas credited for the same amount. The actual collection was for 750 dollars.
So I debit cash 180 and credit AR 180 right?
Question 5: The purchase of a computer printer on account for 500 was recorded as a debit to supplies for 500 and a credit to AP for 500
It should be a debit to equipment?
Question 6: Services were performed on account for a client for 890. AR was debited 890 and Service Revenue was credited 89
Credit Revenue 801?
Question 7: A payment on account for 206 dollars was credited to cash for 206 and credited to AP for 260.
AP should be debited so debit AP for 260 to get rid of the credit then credit for the correct amount 206?
Question 8: When the Unearned Service Revenue account was reviewed, it was found that 325 dollars of the balance was earned
So I would debit Unearned Revenue 325 dollars? Do I also credit service revenue?
Here is the original balance
Debits:
AR 3,231
Supplies 800
Equipment 3,800
Unearned Service Revenue 1,200
Wages Expense 3,400
Office Expense 940
Credits:
Cash 2,870
AP 2,666
Common Stock 6,000
Retained Earnings 3,000
Service Revenue 2,380
Thanks in advance for your help!
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New Member
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Sep 16, 2009, 06:10 PM
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So I see that we have the same accounting book... and the problem confused us both!
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Uber Member
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Sep 16, 2009, 07:02 PM
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Question 1: A debit posting to Wages Expense of 670 dollars was omitted.
So do I now credit or debit Waged Expense?
If you omitted a debit, doesn't it stand to reason that you need to get that debit in there?
Question 2: A payment of 65 dollars for telephone charges was recorded as a debit to Office Expense for 65 dollars and a debit to Cash for 65 dollars.
It should be a credit to Cash and a debit to O.E. right?
Correct.
Question 3: A dividend of 575 dollars was debited to Wages Expense for 575 and credited to cash for 575. What should I do now?
Dividends aren't wages because they are payments to owners and not wages being paid to employees. Dividends can actually go two different places depending on your book. Look up where they've told you to put them.
4, 5 & 6 correct
Question 7: A payment on account for 206 dollars was credited to cash for 206 and credited to AP for 260.
AP should be debited so debit AP for 260 to get rid of the credit then credit for the correct amount 206?
If AP should be a debit, after the reversal of the error, why would you turn around and credit it again?
Question 8: When the Unearned Service Revenue account was reviewed, it was found that 325 dollars of the balance was earned
So I would debit Unearned Revenue 325 dollars? Do I also credit service revenue?
Yes, because it was earned and you need to recognize that on the books.
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Uber Member
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Sep 16, 2009, 07:03 PM
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So just curious... what book is this?
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New Member
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Sep 17, 2009, 07:07 AM
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Intermediate Accounting 13th edition by kieso, weygandt, warfield
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Uber Member
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Sep 17, 2009, 10:41 PM
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I have the 12th edition of that. In that case, #3 is debited to Dividends (and will be closed to retained earnings later).
I was a bit surprised to hear this is for intermediate. I see this stuff in principles a lot.
If this is intermediate, you need to start developing these kind of analytical skills It's silly when they do this in principles, but for intermediate you need to start learning to deal with whatever some client may do to screw everything all up and then have to figure out how to straighten it out.
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