[lisa456]

My unadjusted trial balance is not adjusting. Below is what I need to post and I have attached my file please help.
July
1 Jim invested 40,000 cash and photography equipment valued at 20,000 in the business.

1 Purchased office supplies for cash 1,300

1 Purchased photography supplies on account 6,700
1 Paid July rent 1,700

1 Paid for newspaper ad 500

2 Purchased Office equipment on account 6,750

2 Paid property insurance for the upcoming year 3,600

3 purchased a computer system and software, 3,200, notes payable
5 Paid for promotional handouts 150
6 Paid miscellaneous expenses 175

7 Paid salaries of employees 1,400
7 Recorded weeks cash receipts for photo work 1,350
8 Paid for carpet cleaning Msc expense 75
9 Recorded phot0 work done on account 855
9 Purchased additional Photography supplies on account 3,200
10 Purchased additional Photography Equipment for cash3,500
10 Vending Machine Revenue 200
11 Purchased Furniture for the lobby 1,700 in cash
12 Paid cash for overhead lighting 900
15 Recorded cash receipts 2,170
15 Paid salaries 1,400
17 Drawing for 800
18 Paid for TV ad 710
19 Paid for repair to equip 80
19 Collected 500 on account for service
22 Paid salaries 1,400
22 Recorded cash receipts 2,045
23 Photo session on credit 550
28 Recorded cash receipts 1,995
29 Paid salaries 1,400
30 Paid water bill 75
30 Paid electric bill 1,095
31 Made a 500 payment on office equipment note on 3rd
31 Made 2,000 payment on office equipment purchased
31 Made a payment on photography supplies on account 1,000
31 Drawing 310
31 Vending machine revenue 80




a) Office supplies on hand 850
b) Photography supplies on hand 5,550
c) Insurance expired, 300
d) Salaries unpaid for 2 days 1400
e) Depreciation of office equipment 190
f) Depreciation of photography equip 275
g) Depreciation of furniture and fixtures 75

[morgaine300]

Hi Lisa. I'm going to say first off that since this is a comprehensive problem and probably worth some credit, I'm not going to give you answers or tell you exactly what is wrong. I'm going to attempt to lead you the right direction. It's your work to do. i.e. I'll "help" but not actually do anything for you. And I know this is quite long... but I had stuff to say, that's really too much for a forum situation. But there it is.

First we have some lessons to learn about journalizing. I believe except for one entry, you seem to have the debit/credit rules OK. All lines of entries consist of three things: the account name, the correct dr/cr side, and the amount. You seem OK with the dr/cr side thing, and the amounts are all OK. It's the account names you're mostly having issues with. Part of it is a lack of understanding of how you're supposed to be journalizing (i.e. technicality of how to get it on the paper), but there's also a couple that are interpretation from the transactions.

When you journalize, you use the exact account names as they are in the ledger. You're doing a couple of wrong things... one of which is more picky, like getting the idea but not the exact name. (i.e. Jim's Drawing instead of Jim Arnold, Drawing). Now those are the picky ones. But the non-picky ones are where you've either described the transaction or just made up some account that doesn't exist. Like Electric Bill Expense. There isn't any Electric Bill Expense. It goes under Utilities Expense. You posted most of those to the correct places -- now call the accounts on the journal by the same name.

I wish I were able to format on your worksheet so I could bold or color certain ones, but it's locked. Take a look at July 1st (last one), 3rd, 5th, 7th, 11th, 19th (1st one), 30th, 31st. That doesn't include all the account names you've been making up, but you've repeated some of the same things over & over.

Now, another issue about posting. You have some outright wrong accounts on a few things, and yet posted most of them to the correct place. That's just a no-no. The fact that it got to the right place is good, except that you make the decision of what account to use while you're journalizing, and then you post to the account you used. If you decide you used the wrong account as you're posting, fix the journal entry!

A good example of this is the 3rd entry. You debited Photography Equipment. This is not paying close attention to what the transaction says, because it specifically says supplies, not equipment. Those are two different categories - supplies is a current asset and equipment is a fixed asset. Not the same thing at all. But... then you proceeded to post the thing to the correct account. If you realized that was incorrect on the journal entry, fix the journal entry.

First one on July 2 - same thing: you journalized to the wrong account but posted to the correct one. Supplies aren't an expense until you use them. Same thing with the 2nd entry on July 9th.

Here's a real fun one: that same 2nd one on the 9th. You've credited Cash when it was purchased on account. But then you posted it to Accounts Payable! Quite personally, I don't know how the heck you could have even caught that while posting, because there wouldn't be any way to remember what that entry was later when you're posting. (And you shouldn't need to remember. As I said, you decide where things go while journalizing. Posting should only be copying mindlessly without having to decide things.)

All those screwy things made it that much more difficult to checkyour work. I was checking journal entries and many were messed up, and then most of the account balances were correct. So that took me quite some time to figure out why. Which is one reason not to do this -- it confuses other people who are trying to look at it. And your journal entries are your record of the transaction itself - not the ledgers. The ledgers are the balances of specific accounts and don't say where they came from or what the transaction was. If anyone needed to see the transaction itself, many of them are incorrect and wouldn't make sense.

Here's a delightfuly screwy one... 2nd one on the 19th. Your journal entry is dr A/R and cr Service Revenue. (Which should be Photography Revenue since that's what it's called.) There was no revenue. The customers were just paying on account. When the customer pays you, first, you get the cash. Second, it comes off the receivable. You aren't earning anything. You earned it, and recorded those earnings, at the time it went into the receivables to begin with. And yet... this managed to get posted correctly! I'll never figure out how you managed to get that into the accounts correctly but have the entry itself entirely screwed up. The entry makes it look like you don't understand it, and I don't see how you managed to fix it while posting. Unless of course you copied off someone else. But any instructor who looks at this closely is going to wonder what the heck is going on.

Now one that is a matter of interpretation, on the 12th. It did occur to me that the lighting would be a fixture. (Although the account is called Furniture & Fixtures.) However, I suspect that lighting is for the photography, as opposed to just normal old lighting, like for the office. Since it's likely specialty lights, I personally would put that under the Photography Equipment. But that is my opinion.

Now, all of the above is prior to adjusting entries. I haven't gotten that far cause it took me quite a while just to go through the other stuff and figure out what you did. (Not having an answer key makes it difficult.) But you need to fix that stuff.

As to why you're out of balance... I've only found one error so far, and one of them you should have caught. Apparently you have not been taught why you put posting references on the journal. Take your eye and run it down that column on your journals. See any problem?

You now need to know how to find errors when you don't balance, and it's obvious you have not followed these steps because there's a glaring mistake if you check everything. So you do the following:
*Re-add the columns. (Since it's in Excel, that one is not really necessary, though it's not a bad idea to check the equation itself.)
*Figure out the difference between the two columns and write that down. Look for this number everywhere - in the trial balance, the ledger and the journal. You could have just missed something.
*Take that above figure and divide it in half. Things that are on the wrong side will double themselves. So divide the difference in half and look for that number too, everywhere.
*Check that you copied each number from the ledgers correctly. Be carefuly when doing this. It's easy to see what you think you should. And good idea to mark each in some way as you go or it can be easy to miss that you've left something out. Check carefully for transpositions (1234 as 1324) and slides (1230 as 12300).
*Check the ledger accounts themselves for the math - i.e. rebalance and make sure they're correct.
*Check that you posted everything. That's where those posting references come into play.
*Check that each journal entry balances to begin with.
*Very last thing if you are still stuck: check all the postings themselves. And you must mark each one as you go, both on the journal and on the ledger, or you would never find anything. This ones gets left for last because it's tedious and difficult, and hopefully you find it before you get to this stage.
*Each time you find a mistake, be careful about correcting it, and then start back at step 2, figuring the difference between the 2 columns since it will have changed.

Now, much of the above doesn't need done cause I already know they aren't the problem, but for future reference. (The italicized ones you really need to do.) I've found one mistake, but you've got at least one other mistake somewhere. I found the obvious one but have not actually checked the trial balance itself yet. I will do that if/when I have time, but there's an obvious one, and you've got other stuff to fix.

As a note, you really shouldn't attempt to do adjusting entries without a trial balance that is correct. If any of those entries are dependent upon those balances, that'll screw you up and you have to fix them. And... when you go back to check that you copied everything to the T/B correctly, it just makes it more difficult when you've already got adjusting and closing entries posted. And once you find the mistakes, you're going to have to carry the corrections all the way through the worksheet and statements and closing entries.

[morgaine300]

I just found something. Why are there balances in the unadjusted trial balance that are not in the accounts prior to adjusting entries? At the time you did the unadjusted trial balance, those entries should not have already been done.

It's looking like you've done the adjusting entries first, posted them, and then used adjusted balances to put into you unadjusted trial balance. You need to make that unadjusted trial balance match the unadjusted balances. There isn't any point to an unadjusted and adjusted trial balance if they both are exactly the same. Just using line 14 as an example, there wasn't anything in that account prior to adjusting entries. And if you have 190 debit and adjust it by another 190 debit, that makes 380 debit.

That by itself won't put you out of balance, if all the adjusting entries are balanced. But it does mean the totals are incorrect.

[morgaine300]

In real life you would never know the net income (loss). You can't just take a check figure that you have and insert it. This doesn't balance. You need to subtract the debit and credit columns, for both the income statement and balance sheet, and find out what numbers you actually have. You could copy one of those numbers over incorrectly, and you'd never catch it if you just insert what you know to be correct. Your actual statements aren't going to work out this way either.

You need to fix it until it comes out to the correct check figure, not just plug it in as though everything is OK.

By the way, why not take advantage of cell references instead of copying all those numbers by hand. That also takes care of the issue of correcting stuff -- it'll correct the rest of the worksheet automatically if you use all cell references and equations.

[sonia3110]

Did you ever find the answers to this? I am having problems balancing out my trial balance on the worksheet.

[pready]

Based on the information provided in the original post, the Trial Balance Debits and Credits should equal 85,595.

From the original post there was a payment to a Note Payable, but there is no interest amount. When a note is issued there is an annual interest rate included. It should have been stated when the note was issued.