Question

In: Accounting

The Lexington Group has the following unadjusted trial balance as of May 31, 2018: The Lexington...

The Lexington Group has the following unadjusted trial balance as of May 31, 2018:

The Lexington Group

UNADJUSTED TRIAL BALANCE

May 31, 2018

ACCOUNT TITLE DEBIT CREDIT

1

Cash

20,350.00

2

Accounts Receivable

37,000.00

3

Supplies

1,100.00

4

Prepaid Insurance

200.00

5

Equipment

171,175.00

6

Notes Payable

36,000.00

7

Accounts Payable

26,000.00

8

Common Stock

50,000.00

9

Retained Earnings

94,150.00

10

Dividends

15,000.00

11

Fees Earned

429,850.00

12

Wages Expense

270,000.00

13

Rent Expense

63,000.00

14

Advertising Expense

25,200.00

15

Miscellaneous Expense

5,100.00

16

Totals

608,125.00

636,000.00

The debit and credit totals are not equal as a result of the following errors:

A. The cash entered on the trial balance was overstated by $7,000.
B. A cash receipt of $8,200 was posted as a debit to Cash of $2,800.
C. A debit of $16,500 to Accounts Receivable was not posted.
D. A return of $125 of defective supplies was erroneously posted as a $1,250 credit to Supplies.
E. An insurance policy acquired at a cost of $3,600 was posted as a credit to Prepaid Insurance.
F. The balance of Notes Payable was understated by $9,000.
G. A credit of $10,000 in Accounts Payable was overlooked when determining the balance of the account.
H. A debit of $5,000 for dividends was posted as a credit to Retained Earnings.
I. The balance of $60,300 in Rent Expense was entered as $63,000 in the trial balance.
J. Gas, Electricity, and Water Expense, with a balance of $16,350, was omitted from the trial balance.
Required:
1. Prepare a corrected unadjusted trial balance as of May 31, 2018.

The Lexington Group

UNADJUSTED TRIAL BALANCE

Score: 0/67

May 31, 2018

ACCOUNT TITLE DEBIT CREDIT

1

Cash

2

Accounts Receivable

3

Supplies

4

Prepaid Insurance

5

Equipment

6

Notes Payable

7

Accounts Payable

8

Common Stock

9

Retained Earnings

10

Dividends

11

Fees Earned

12

Wages Expense

13

Rent Expense

14

Advertising Expense

15

Gas, Electricity, and Water Expense

16

Miscellaneous Expense

17

Totals

Solutions

Expert Solution

The Lexington Group

Unadjusted Trial Balance

May 31, 2018

ACCOUNT TITLE

Adjustments

DEBIT

CREDIT

1

Cash

20350-7000 + 5400

$18750

2

Accounts Receivable

37000+16500

$53500

3

Supplies

1100+1125

$2225

4

Prepaid Insurance

200+3600+3600

$7400

5

Equipment

$171175

6

Notes Payable

36000+9000

$45000

7

Accounts Payable

26000+10000

$36000

8

Common Stock

$50000

9

Retained Earnings

+94150-5000

$89150

10

Dividends

+15000+5000

$20000

11

Fees Earned

$429850

12

Wages Expense

$270000

13

Rent Expense

$60300

14

Advertising Expense

$25200

15

Gas, Electricity, and Water Expense

$16350

16

Miscellaneous Expense

$5100

17

Totals

$650000

$650000


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