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In: Accounting

The Revenue account balance of $42 000 was listed on the trial balance as a debit....

The Revenue account balance of $42 000 was listed on the trial balance as a debit. How much is the balance sheet off by, and is the debits more than the credits?

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Expert Solution

When Revenue account balance of $ 42,000 is shown as debit mistakenly in Trial balnce and trial balance isn't matching.

In this case, Generally, Revenue account shows credit balance, however if instead of listing on Credit if it is listed on Debit side mistakenly. Then in that case Debits would be more than credits by $ 84,000 (i.e, twice the amount). It is explained in the following way.

Had an amount of $ 42,000, being mentioned properly in the credit side, the trail balance would look in the following way:

Trial Balance
Particulars Debit Credit
Capital      50,000
liablilities      50,000
Assets 122,000
Expenses 20,000
Revenue 42000
142,000

142,000

However, as it is entered mistakenly on debit side the trial balance would as below:

Trial Balance
Particulars Debit Credit
Capital      50,000
liablilities      50,000
Assets 122,000
Expenses 20,000
Revenue 42,000
184,000.00 100,000.00

Here, we can see that the debit side has exceed the credit side by $ 84,000

ekkarill92 answered 2 years ago
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