Q2E
Question
E3-2 (L02) (Corrected Trial Balance) The following trial balance of Wanda Landowska Company does not balance. Yourreview of the ledger reveals the following. (a) Each account had a normal balance. (b) The debit footings in Prepaid Insurance,Accounts Payable, and Property Tax Expense were each understated \(100. (c) A transposition error was made in AccountsReceivable and Service Revenue; the correct balances for Accounts Receivable and Service Revenue are \)2,750 and \(6,690,respectively. (d) A debit posting to Advertising Expense of \)300 was omitted. (e) A \(1,500 cash drawing by the owner was debited to Owner’s Capital and credited to Cash.
Debit (\)) Credit (\() Cash \) 4,800Accounts Receivable 2,570Prepaid Insurance 700Equipment \( 8,000Accounts Payable 4,500Property Taxes Payable 560Owner’s Capital 11,200Service Revenue 6,960Salaries and Wages Expense 4,200Advertising Expense 1,100Property Tax Expense 800
Prepare a correct trial balance.
Step-by-Step Solution
VerifiedThe total corrected trial balance is 24,350.
The trial balanceis a worksheet in which all the ledger balances are recordedand divided into debit and credit columns. Debit and credit totals should be equal at the end of the reporting period.
Wanda Landowska Company Trail balance April 30, 2017 | ||
Particulars | Debit $ | Credit $ |
Cash | 4,800 |
|
Accounts receivable | 2750 |
|
Prepaid insurance($700 + $100) | 800 |
|
Equipment | 8,000 |
|
Owners drawings | 1500 |
|
Salaries and wage expenses | 4200 |
|
Advertising expenses($1100 + $300) | 1400 |
|
Property tax expense ($800 + $100) | $900 |
|
Accounts payable ($4500 - $100) |
| 4400 |
Property tax payable |
| 560 |
Owners capital ($11,200+$1,500) |
| 12700 |
Service revenue |
| 6690 |
Total | 24,350 | 24,350 |