Valley Realty acts as an agent in buying, selling, renting, and managing real estate. The unadjusted trial balance on July 31, 2019, follows: Valley Realty Unadjusted Trial Balance July 31, 2019 Account No. Debit Balances Credit Balances 52,500 Cash 11 Accounts Receivable. . 12 100,100 Prepaid Insurance Office Supplies... Land . Accounts Payable 13 12,600 14 2,800 16 21 21,000 Unearned Rent. 22 Notes Payable.. Cindy Getman, Capital.. Cindy Getman, Drawing 23 87,500 31 32 44,800 Fees Earned.... 41 591,500 Salary and Commission Expense.. Rent Expense. Advertising Expense.. Automobile Expense Miscellaneous Expense 51 385,000 49,000 52 53 32,200 15,750 54 59 5,250 700,000 700,000 The following business transactions were completed by Valley Realty during August 2019: 1. Purchased office supplies on account, $3,150 2. Paid rent on office for month, $7,200 3. Received cash from clients on account, $83,900 Aug. 5. Paid insurance premiums, $12,000. 9. Returned a portion of the office supplies purchased on August 1, receiving full credit for their cost, $400 (Continued) Aug. 17. Paid advertising expense, $8,000 23. Paid creditors on account, $13,750. Enter the following transactions on Page 19 of the two-column journal 29. Paid miscellaneous expenses, $1,700. 30. Paid automobile expense (including rental charges for an automobile), $2,500 31. Discovered an error in computing a commission during July; received cash from the salesperson for the overpayment, $2,000. 31. Paid salaries and commissions for the month, $53,000. 31. Recorded revenue earned and billed to clients during the month, $183,500. 31. Purchased land for a future building site for $75,000, paying $7,500 in cash and giving a note payable for the remainder. 31. Withdrew cash for personal use, $1,000 31. Rented land purchased on August 31 to a local university for use as a park ing lot during football season (September, October, and November); received advance payment of $5,000 Instructions 1. Record the August 1 balance of each account in the appropriate balance column of a four-column account, write Balance in the item section, and place a check mark (V) in the Posting Reference column 2. Journalize the transactions for August in a two-column journal beginning on Page 18. Journal entry explanations may be omitted. 3. Post to the ledger, extending the account balance to the appropriate balance column after each posting 4. Prepare an unadjusted trial balance of the ledger as of August 31, 2019. 5. Assume that the August 31 transaction for Cindy Getman's cash withdrawal should have been $10,000. (a) Why did the unadjusted trial balance in (4) balance? (b) Journalize the correcting entry. (c) Is this error a transposition or slide?

Valley Realty acts as an agent in buying, selling, renting, and managing real estate. The unadjusted trial balance on July 31, 2019, follows: Valley Realty Unadjusted Trial Balance July 31, 2019 Account No. Debit Balances Credit Balances 52,500 Cash 11 Accounts Receivable. . 12 100,100 Prepaid Insurance Office Supplies... Land . Accounts Payable 13 12,600 14 2,800 16 21 21,000 Unearned Rent. 22 Notes Payable.. Cindy Getman, Capital.. Cindy Getman, Drawing 23 87,500 31 32 44,800 Fees Earned.... 41 591,500 Salary and Commission Expense.. Rent Expense. Advertising Expense.. Automobile Expense Miscellaneous Expense 51 385,000 49,000 52 53 32,200 15,750 54 59 5,250 700,000 700,000 The following business transactions were completed by Valley Realty during August 2019: 1. Purchased office supplies on account, $3,150 2. Paid rent on office for month, $7,200 3. Received cash from clients on account, $83,900 Aug. 5. Paid insurance premiums, $12,000. 9. Returned a portion of the office supplies purchased on August 1, receiving full credit for their cost, $400 (Continued) Aug. 17. Paid advertising expense, $8,000 23. Paid creditors on account, $13,750. Enter the following transactions on Page 19 of the two-column journal 29. Paid miscellaneous expenses, $1,700. 30. Paid automobile expense (including rental charges for an automobile), $2,500 31. Discovered an error in computing a commission during July; received cash from the salesperson for the overpayment, $2,000. 31. Paid salaries and commissions for the month, $53,000. 31. Recorded revenue earned and billed to clients during the month, $183,500. 31. Purchased land for a future building site for $75,000, paying $7,500 in cash and giving a note payable for the remainder. 31. Withdrew cash for personal use, $1,000 31. Rented land purchased on August 31 to a local university for use as a park ing lot during football season (September, October, and November); received advance payment of $5,000 Instructions 1. Record the August 1 balance of each account in the appropriate balance column of a four-column account, write Balance in the item section, and place a check mark (V) in the Posting Reference column 2. Journalize the transactions for August in a two-column journal beginning on Page 18. Journal entry explanations may be omitted. 3. Post to the ledger, extending the account balance to the appropriate balance column after each posting 4. Prepare an unadjusted trial balance of the ledger as of August 31, 2019. 5. Assume that the August 31 transaction for Cindy Getman's cash withdrawal should have been $10,000. (a) Why did the unadjusted trial balance in (4) balance? (b) Journalize the correcting entry. (c) Is this error a transposition or slide?

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter22: Accounting For Changes And Errors.

Section: Chapter Questions

Problem 8RE: At the end of 2019, Framber Company received 8,000 as a prepayment for renting a building to a...

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