Question

In: Accounting

Given the following errors, identify the one by itself that will cause the trial balance to...

Given the following errors, identify the one by itself that will cause the trial balance to be out of balance.

Multiple Choice

A $210 cash receipt from a customer in payment of her account posted as a $210 debit to Cash and a $21 credit to Accounts Receivable.

A $310 cash salary payment posted as a $310 debit to Cash and a $310 credit to Salaries Expense.

A $130 cash receipt from a customer in payment of her account posted as a $130 debit to Cash and a $130 credit to Cash.

An $1,350 prepayment from a customer for services to be rendered in the future was posted as an $1,350 debit to Unearned Revenue and an $1,350 credit to Cash.

A $83 cash purchase of office supplies posted as a $83 debit to Office Equipment and a $83 credit to Cash.

Solutions

Expert Solution

1. Since the amount credited to Accounts Receivable A/c is $21 instead of $210, the credit side of the trial balance will be more by $189 and hence will make it out of balance.

2. The actual entry should have been debit to salary expense and credit to cash a/c which was erronerously posted in opposite sides. However since the amount entered into in the erroneous posting is same, the trial balance will not become out of balance

3. receipt from customer should have been debited to cash a/c and credited to customer a/cwhich was erronerously posted in opposite sides. However since the amount entered into in the erroneous posting is same, the trial balance will not become out of balance

4. prepayment from a customer for services to be rendered should have been debited to cash a/c and credited to unearned income a/c which was erronerously posted in opposite sides. However since the amount entered into in the erroneous posting is same, the trial balance will not become out of balance.

5. cash purchase of office supplies should have been debited to office supplies a/c rather than to office equipment a/c. However since due debit impact of $83 occurred for corresponding credit, the error will not make the trial balance out of balance

ekkarill92 answered 2 years ago
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