Concept explainers
Introduction:
To identify: The amount of difference between two trail balance columns.
2.
Introduction: Journal entry is a technique of booking and recording financial transactions on any company. Ledger is used to record all economic transactions of the account by account type, with debits and credits in separate columns and a beginning monetary balance and ending monetary balance for each account.
To identify: The trail balance column (debit or credit) with larger amount.
3.
Introduction: Journal entry is a technique of booking and recording financial transactions on any company. Ledger is used to record all economic transactions of the account by account type, with debits and credits in separate columns and a beginning monetary balance and ending monetary balance for each account.
To identify: the account affected by the error.
.Description of posting error | The account incorrectly stated) | |
a. | 3600 debit to rent expense is posted as a $1340 | Rent Expense |
b. | $6500 credit to cash is posted twice as two credits to cash | Cash |
c. | $10900 debit to the Dividends account is debited to common stock | Dividend and common stock |
d. | 2050 debit to prepaid insurance is posted as a debit to insurance expense | Prepaid insurance and insurance expense |
e. | 38000 debit to machinery is posted as a debit to account payable | Machinery and account payable |
f. | 5850 credit to service revenue us posted as a 585 credit | Service revenue |
g. | 1390 debit to tore supplies is not posted | Store supplies |
Introduction: Journal entry is a technique of booking and recording financial transactions on any company. Ledger is used to record all economic transactions of the account by account type, with debits and credits in separate columns and a beginning monetary balance and ending monetary balance for each account.
To identify: The amount by which the account in column (3) is under or overstated
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Loose Leaf for Financial Accounting: Information for Decisions
- Complete the following table by filling in the blanks. For each of the listed posting errors: 1. Enter in column (1) the amount of the difference that the error would create between the two trial balance columns (show a zero if the columns would balance). 2. Identify if there would be a difference between the two columns, and identify in column (2) the trial balance column that would be larger. 3. Identify the account(s) affected in column (3). 4. Identify the amount by which the account(s) is (are) under- or overstated in column (4). The answer for the first error is provided as an example. (1) Difference (2) column With the Larger Total Stated (3) Identify Account(s) Incorrectly Stated (4) Account(s) is Overstated or Understated Description Between Debit and Credit Columns A $2.400 debit to Rent expense was posted as a $1,590 debit. $ 810 Credit Rent expenses Understated a. A $42,000 debit to Machinery was posted as a debit b. to Accounts payable. A $4.950 credit to Services revenue…arrow_forwardErrors can occur in posting debits and credits from the journal to the ledger. One way to detect errors is by transferring the balances in each account to summary report called the _____________________ and by adding the debit column and the credit column to see if the totals equal (or balance). Group of answer choices ledger journal balance sheet trial balancearrow_forwardA debit balance in which of the following accounts would indicate a likely error? a.Notes Payable b.Supplies c.Salaries Expense d.Accounts Receivablearrow_forward
- Identify whether a debit or credit results in the indicated change for each of the following accounts. To decrease Accounts Receivablearrow_forward2. MC.03.002 A book of original entry is known as a a. ledger account. b. trial balance. c. general ledger. d. Taccount. e. Journal. 3.MC.03.003 An accountant wanting to know the balance of a particular account would refer to the a. source document. b. chart of accounts. c. journal. d. book of original entry. e. ledger. 4.MC.03.004 The process of subtotalling both sides of an account and recording the amount on that side is known as a. Journalizing. b. footing. c. balancing the accounts. d. taking a trial balance. e. posting. 5.MC.03.005 If the number of an account is 211, this probably means that the account is the first account in the a. Liabilities section. b. Owner's Equity section. c. Revenues section. d. Expenses section. e. Assets section. 6. MC.03.006 When an entry is posted, the last step in the process is a. placing the balance of the account in either the debit or credit column in the ledger. b. placing the account number in the Post. Ref. column of the ledger. c. placing…arrow_forwardThe following errors will not be revealed by the trialSelect one: a. Balances incorrectly recordedb. Balances omittedc. Posting to the wrong accountd. Casting of debit or credit columns.arrow_forward
- The notes receivable is debited by the bookkeeper instead of accounts receivable. What is the effect of the error in the total assets of the entity? a. No effect b. Cannot be determined based on the given information c. Understated d. Overstatedarrow_forwardChoose only one answer as well as state their reasons/rationale for the answer chosen. 8) A data entry application control that is designed to ensure that the total debits in a journal entry equal the total credits is called aa. Sign checkb. Hash totalc. Reasonableness checkd. Zero-balance checke. Financial totalarrow_forwardIf a $335.00 debit item in the general journal is posted as a credit: By how much will the trial balance be out of balance? Explain how you might detect such an error.arrow_forward
- The collection of accounts of Customer Alexander is recorded as a credit to the ledger of Customer Sean. What is the effect of the error in the total assets of the entity?arrow_forwardA credit balance in which of the following accounts would indicate a likely error? a.Common Stock b.Salary Expense c.Accounts Payable d.Fees Earnedarrow_forwardAfter preparing the trial balance, the accountant finds that the total of debit side is OMR 125,600 and Total of Credit Side OMR 126,500. This difference should be treated before rectification of errors wasarrow_forward
- College Accounting (Book Only): A Career ApproachAccountingISBN:9781337280570Author:Scott, Cathy J.Publisher:South-Western College PubCentury 21 Accounting Multicolumn JournalAccountingISBN:9781337679503Author:GilbertsonPublisher:Cengage