Accounting & Bookkeeping & Small Business Forum

[Hidalgo]

I'm supposed to correct a trial balance but I keep ending up about $100 short. There wasn't an entry for supplies so I just added a new T-account for it. Here is the info; I appreciate any help you guys give.

Debits
Cash= $975
Accounts Receivable= $3,800
C.Equipment= $13,500
Office equipment = $6,600
Withdrawals= $4,200
Expenses= $8,600

Credits
Fees Earned= $10,875
Accounts Payable= $4,510
Capital= $23,000

Here are the errors in the trial balance that I need to correct.

1. A purchase of supplies on account for $245 was posted a debit to Supplies and as a debit to Accounts Payable.
2. An owner investment of $500 was debited to Capital and credited to Cash.
3. In computing the balance of the Accounts Receivable account, a debit of $600 was omitted.
4. One debit of $300 to the Withdrawals account was posted as a credit.
5. Office Equipment purchased for $800 was posted to the C.Equipment account.
6. An entire entry was not posted to the g.ledger. The transaction involved the receipt of $125 for services preformed for cash.

[sinsabit]

Hi Hidalgo,

Actually I don't think you need to add the new T account and debit for the supplies, because the debit has assumedly already hit the supplies account (which should sit within the Expenses category in our schedule)

So going through them one by one:
1) $245 posted as debit in AP (should have been credit, reverse out by double crediting Accounts Payable = $490)

2) Both cash and capital accounts were posted to the wrong way around so
reverse out in the same manner Dr Cash 1000 Cr capital 1000

3) Debit omitted from AR, simply add it in. Dr Accounts Receivable $600

4) Withdrawal debit posted wrong way round, reverse in the usual way. Dr Withdrawal account $600

5) Simply correct by transferring to correct account Dr Office Equip $800 Cr C Equip $800

6) total double entry omitted so we just put it in: Dr Cash $125 Cr Fees earned $125

Should bring the TB to zero

Paul

[Hidalgo]

Thanks for the help, I think I got the hang of double crediting/debiting.

[Heartwood]

Hi,

what would be on the DR side of the correcting entry for AP ?
If you CR AP by the double amount of 490, what account is CRed then ?

Thanks.

[Beth@WorkHorseAcctg]

According to the info provided in the original post, Quote: A purchase of supplies on account for $245 was posted a debit to Supplies and as a debit to Accounts Payable. It says that two debits were recorded instead of a debit and a credit. So, you have to reverse the one side of the entry that was posted wrong (the duplicate debit in A/P that should have been a credit). Then you add the credit that should have been there. That's how they come up with $490 credit and no debit. It was a manual posting error. This will RARELY (but not necessarily never) happen with a computerized accounting system.

Hope this makes it a little more clear for you.