Question

Transactions and T Accounts

The following selected transactions were completed during March of the current year:

1. Billed customers for fees earned, $50,700.
2. Purchased supplies on account, $2,180.
3. Received cash from customers on account, $47,660.
4. Paid creditors on account, $1,320.

a. Journalize the transactions in a two-column journal, using the appropriate number to identify the transactions.

(1)
(2)
(3)
(4)

b. Post the entries prepared in (a) to the following T accounts: Cash, Supplies, Accounts Receivable, Accounts Payable, Fees Earned. To the left of each amount posted in the accounts, select the appropriate number to identify the transactions.

Cash

Accounts Payable

Supplies

Fees Earned

Accounts Receivable

c. Assume that the unadjusted trial balance on March 31 shows a credit balance for Accounts Receivable. Does this credit balance mean an error has occurred?

Answer 1

Date	Particulars	Debit	Credit
		$	$
1	Accounts receivable	50,700
	Fees earned		50,700
	(to record fees revenue)
2	Supplies	2180
	Accounts payable		2180
	(to record purchase of supplies)
3	Cash	47,660
	Accounts receivable		47.660
	(to record receipt from receivables)
4	Accounts payable	1320
	Cash		1320
	(to record payment)

b) T - Account

Cash Account

Particulars	Amount	Particulars	Amounts
Accounts receivable	47660	Accounts payaable	1320

Supplies Account

Particulars	Amount	Particulars	Amounts
Accounts payable	2180

Accounts receivable

Particulars	Amount	Particulars	Amounts
Fees earned	50700	cash	47660

Accounts payable

Particulars	Amount	Particulars	Amounts
cash	1320	Supplies	2180

Fees earned

Particulars	Amount	Particulars	Amounts
		Accounts receivable	50700

C)No its doesn't mean that error has occured , It can also be because of the overpayment or advnce received from the customer .