I am confused with this part of my homework.. here it is...

The bookkeeper for Stan Tucci Equipment repair made a number of errors in journalizing and posting, as described below.

1.A debit posting of $750 for prepaid insurance was debited to insurance expense.
2. A cash purchase of supplies for $250 was journalized and posted as a debit to supplies $25 and a credit to cash $25

Instruction:

For each error:
a.) indicate whether the trial balance will balance
b.)if the trial balance will not balance, indicate the amount of difference
c.)indicate the trial balance column that will have the larger total

Ok, (not trying to come off as rude) this website has a rule, https://www.askmehelpdesk.com/financ...board-b-u.html ,that we can't give you answers until you first show us that you at least gave a try at your homework questions. Once you do this we can help you more in detail. Since you seem confused though I will try to provide you with some questions to answer so that you can show you attempted to answer these questions and we can tell you if you are right or wrong and provide a detailed explanation.

#1
He debited 750 to prepaid insurance instead of insurance expense. Will this change the balance at all? Meaning will this make the trail balance (debits must equal credits) unbalanced? If it does how much does it make it unbalanced? Which one (debit or credit column) has more in it that made it unbalanced? Yes, these are the instructions you posted but I just tried to make them a little more understandable.

#2
A purchase of supplies were made. Instead of posting $250 worth of supplies he posted $25 worth and credited cash for only $25 as well. Ask yourself the questions I asked for question #1 and try to answer them on here for more help. Good luck and I'll wait for your reply so I can help you more in detail.

Quote:

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Originally Posted by Superfly999

#1
He debited 750 to prepaid insurance instead of insurance expense. Will this change the balance at all? Meaning will this make the trail balance (debits must equal credits) unbalanced? If it does how much does it make it unbalanced? Which one (debit or credit column) has more in it that made it unbalanced? Yes, these are the instructions you posted but I just tried to make them a little more understandable.

#2
A purchase of supplies were made. Instead of posting $250 worth of supplies he posted $25 worth and credited cash for only $25 as well. Ask yourself the questions I asked for question #1 and try to answer them on here for more help. Good luck and I'll wait for your reply so I can help you more in detail.

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1. For the first question, I am assuming that the normal balance of a prepaid insurance is a also debit so I think it does not change the balance.

2. What's weird with this question is that though there is an error in posting the amount, the trial balance is still in balance (well, in my opinion)

Is my analysis right or wrong? I need enlightenment. :p

1.A debit posting of $750 for prepaid insurance was debited to insurance expense.

What should they have done?
Dr. Prepaid Insurance 750
Cr. Cash 750

What was done?
Dr. Insurance Expense 750
Cr. Cash 750

What needs to be done to correct it?
Dr. Prepaid Insurance 750
Cr. Insurance Expense 750

a) Will the trial-balance balance with this mistake? Yes
b) N/A as it will balance
c) Neither. They have will the same numbers.


2. A cash purchase of supplies for $250 was journalized and posted as a debit to supplies $25 and a credit to cash $25

You are again correct. While an error was made, since both the debits and credits were equal, the trial-balance will still balance, although with the wrong numbers.

I need a word to descibe independent