Question

The following trial balance was prepared from the ledger accounts of Ricardo Company: RICARDO COMPANY Trial Balance April 30, Year 1 Account Titles Debit Credit Cash $ 78,400 Accounts receivable 49,000 Supplies 3,700 Prepaid insurance 5,500 Land $ 10,000 Accounts payable 11,500 Common stock 100,000 Retained earnings 34,255 Dividends 9,900 Service revenue 93,000 Rent expense 11,500 Salaries expense 35,300 Operating expense 36,200 Totals $ 229,500 $ 248,755 When the trial balance failed to balance, the accountant reviewed the records and discovered the following errors: 1. The company received $655 as payment for services rendered. The credit to Service Revenue was recorded correctly, but the debit to Cash was recorded as $1,030. 2. A $1,850 receipt of cash that was received from a customer on accounts receivable was not recorded. 3. A $370 purchase of supplies on account was properly recorded as a debit to the Supplies account. However, the credit to Accounts Payable was not recorded. 4. Land valued at $10,000 was contributed to the business in exchange for common stock. The entry to record the transaction was recorded as a $10,000 credit to both the Land account and the Common Stock account. 5. A $1,450 rent payment was properly recorded as a credit to Cash. However, the Salaries Expense account was incorrectly debited for $1,450. Required Prepare a corrected trial balance for Ricardo Company.

Answer 1

Ricardo Company
Trial Balance
As of April 30, Year 1
	Debit	Credit
Cash	79875		=78400-(1030-655)+1850
Accounts Receivable	47150		=49000-1850
Supplies	3700
Prepaid Insurance	5500
Land	10000
Accounts Payable		11870	=11500+370
Common Stock		100000
Retained Earnings		34255
Dividends	9900
Service Revenue		93000
Rent Expense	12950		=11500+1450
Salaries Expense	33850		=35300-1450
Operating Expense	36200
Totals	239125	239125