Question

Edit: ***Journal & Ledger***

Elite Realty acts as an agent in buying, selling, renting, and managing real estate. The unadjusted trial balance on March 31, 20Y3, follows:

Elite Realty

UNADJUSTED TRIAL BALANCE

March 31, 20Y3

	ACCOUNT TITLE	DEBIT	CREDIT
1	Cash	25,200.00
2	Accounts Receivable	58,200.00
3	Prepaid Insurance	3,100.00
4	Office Supplies	2,100.00
5	Accounts Payable		13,300.00
6	Common Stock		10,000.00
7	Retained Earnings		37,000.00
8	Dividends	1,700.00
9	Fees Earned		235,600.00
10	Salary and Commission Expense	146,700.00
11	Rent Expense	33,000.00
12	Advertising Expense	16,200.00
13	Automobile Expense	5,900.00
14	Miscellaneous Expense	3,800.00
15	Totals	295,900.00	295,900.00

The following business transactions were completed by Elite Realty during April 20Y3. Enter the transactions through the 23rd on Page 18 of the two-column journal:

Apr.	1	Paid rent on office for month, $4,500.
	2	Purchased office supplies on account, $2,400.
	5	Paid insurance premiums, $5,100.
	10	Received cash from clients on account, $52,300.
	15	Purchased land for a future building site for $184,000, paying $27,000 in cash and giving a note payable for the remainder.
	17	Paid creditors on account, $6,050
	20	Returned a portion of the office supplies purchased on April 2, receiving full credit for their cost, $320.
	23	Paid advertising expense, $4,100.

Enter the following transactions on Page 19 of the two-column journal:

Apr.	27	Discovered an error in computing a commission; received cash from the salesperson for the overpayment, $3,000.
	28	Paid automobile expense (including rental charges for an automobile), $1,200.
	29	Paid miscellaneous expenses, $1,700.
	30	Recorded revenue earned and billed to clients during the month, $57,000.
	30	Paid salaries and commissions for the month, $11,900.
	30	Paid dividends, $4,000.
	30	Rented land purchased on April 15 to local merchants association for use as a parking lot in May and June, during a street rebuilding program; received advance payment of $10,200.

	Required:
1.	Record the April 1, 20Y3, balance of each account in the appropriate balance column of a four-column account, type Balance in the item section, and select a check mark in the Posting Reference column.
2.	Journalize the transactions for April in a two-column journal beginning on Page 18. Refer to the Chart of Accounts for exact wording of account titles. Insert the appropriate posting references in both the journal and the ledger as each item is posted.
3.	Post to the ledger, extending the account balance to the appropriate balance column after each posting. Post in chronological order. For transactions occurring on the same day, post in the order presented in the instructions. Insert the appropriate posting references in both the journal and the ledger as each item is posted.
4.	Prepare an unadjusted trial balance of the ledger as of April 30, 20Y3.
5.	Assume that the April 30 transaction for salaries and commissions should have been $19,100. (a) Why did the unadjusted trial balance in (4) balance? (b) Journalize the correcting entry on April 30. Use page 20. (Note: You will not be required to post this entry to the ledger at this time.) (c) Is this error a transposition or slide?

Edit: ***Journal & Ledger***

Answer 1

April	Journal Entries	Dr. ($)	Cr. ($)
1	rent expenses	4500
	To cash		4500
2	office supplies	2400
	To cash		2400
5	prepaid insurance	5100
	To cash		5100
10	cash	52300
	To accounts receivable		52300
15	land	184000
	To cash		27000
	To note payable		157000
17	accounts payable	6050
	To cash		6050
20	accounts payable	320
	To office supplies		320
23	advertisement expenses	4100
	To cash		4100
27	cash	3000
	To salary and commission expenses		3000
28	automobile expenses	1200
	To cash		1200
29	miscellaneous expenses	1700
	To cash		1700
30	accounts receivable	57000
	To fees earned		57000
30	salary and commission expenses	11900
	To cash		11900
30	dividends	4000
	To cash		4000
30	cash	10200
	To unearned revenue		10200

Unadjusted Trial Balance
accounts	Dr. ($)	Cr. ($)
cash	22750
accounts receivable	62900
prepaid insurance	8200
office supplies	4180
land	184000
accounts payable		6930
unearned revenue		10200
notes payable		157000
capital stock		10000
retained earnings		37000
dividends	5700
fees earned		292600
salary and commission expenses	155600
rent expenses	37500
advertisement expenses	20300
automobile expenses	7100
miscellaneous expenses	5500
totals	513730	513730

Cash
Post Ref.	Dr. ($)	Cr. ($)	Balance
opening balance	25200	0	25200
1		4500	20700
2		2400	18300
5		5100	13200
10	52300		65500
15		27000	38500
17		6050	32450
23		4100	28350
27	3000		31350
28		1200	30150
29		1700	28450
30		11900	16550
30		4000	12550
30	10200		22750
Accounts Receivable
Post Ref.	Dr. ($)	Cr. ($)	Balance
opening balance	58200	0	58200
10	0	52300	5900
30	57000	0	62900
Prepaid insurance
Post Ref.	Dr. ($)	Cr. ($)	Balance
opening balance	3100	0	3100
5	5100	0	8200
office supplies
Post Ref.	Dr. ($)	Cr. ($)	Balance
opening balance	2100	0	2100
2	2400	0	4500
20	0	320	4180
accounts payable
Post Ref.	Dr. ($)	Cr. ($)	Balance
opening balance	0	13300	13300
17	6050	0	7250
20	320	0	6930
common stock
Post Ref.	Dr. ($)	Cr. ($)	Balance
opening balance	0	10000	10000
retained earnings
Post Ref.	Dr. ($)	Cr. ($)	Balance
opening balance	0	37000	37000
dividends
Post Ref.	Dr. ($)	Cr. ($)	Balance
opening balance	1700	0	1700
30	4000	0	5700
fees earned
Post Ref.	Dr. ($)	Cr. ($)	Balance
opening balance	0	235600	235600
30	0	57000	292600
salary and commission expenses
Post Ref.	Dr. ($)	Cr. ($)	Balance
opening balance	146700	0	146700
27	0	3000	143700
30	11900	0	155600
rent expenses
Post Ref.	Dr. ($)	Cr. ($)	Balance
opening balance	33000	0	33000
1	4500	0	37500
advertising expenses
Post Ref.	Dr. ($)	Cr. ($)	Balance
opening balance	16200	0	16200
23	4100	0	20300
automobile expenses
Post Ref.	Dr. ($)	Cr. ($)	Balance
opening balance	5900	0	5900
28	1200	0	7100
miscellaneous expenses
Post Ref.	Dr. ($)	Cr. ($)	Balance
opening balance	3800	0	3800
29	1700	0	5500
unearned revenue
Post Ref.	Dr. ($)	Cr. ($)	Balance
30	0	10200	10200