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Effect of errors on trial balance The following errors occurred in posting from a two-column journal: 1. A credit of $6,000 to Accounts Payable was not posted. 2. An entry debiting Accounts Receivable and crediting Fees Earned for $5,300 was not posted. 3. A debit of $2,700 to Accounts Payable was posted as a credit. 4. A debit of $480 to Supplies was posted twice. 5. A debit of $3,600 to Cash was posted to Miscellaneous Expense. 6. A credit of $780 to Cash was posted as $870. 7. A debit of $12,620 to Wages Expense was posted as $12,260. Considering each case individually (i.e., assuming that no other errors had occurred), indicate: (A) by “yes” or “no” whether the trial balance would be out of balance; (B) if answer to (A) is “yes,” the amount by which the trial balance totals would differ; and (C) whether the Debit or Credit column of the trial balance would have the larger total. Answers should be presented in the following form, with error (1) given as an example:

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Financial And Managerial Accounting

15th Edition
WARREN + 1 other
Publisher: Cengage Learning,
ISBN: 9781337902663

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Chapter
Section
BuyFindarrow_forward

Financial And Managerial Accounting

15th Edition
WARREN + 1 other
Publisher: Cengage Learning,
ISBN: 9781337902663
Chapter 2, Problem 19E
Textbook Problem
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Effect of errors on trial balance

The following errors occurred in posting from a two-column journal:

  1. 1. A credit of $6,000 to Accounts Payable was not posted.
  2. 2. An entry debiting Accounts Receivable and crediting Fees Earned for $5,300 was not posted.
  3. 3. A debit of $2,700 to Accounts Payable was posted as a credit.
  4. 4. A debit of $480 to Supplies was posted twice.
  5. 5. A debit of $3,600 to Cash was posted to Miscellaneous Expense.
  6. 6. A credit of $780 to Cash was posted as $870.
  7. 7. A debit of $12,620 to Wages Expense was posted as $12,260.

Considering each case individually (i.e., assuming that no other errors had occurred), indicate: (A) by “yes” or “no” whether the trial balance would be out of balance; (B) if answer to (A) is “yes,” the amount by which the trial balance totals would differ; and (C) whether the Debit or Credit column of the trial balance would have the larger total. Answers should be presented in the following form, with error (1) given as an example:

Chapter 2, Problem 19E, Effect of errors on trial balance The following errors occurred in posting from a two-column

To determine

Identify whether each of the following error would cause the trial balance to be out of balance, if yes, the amount by which the trial balance totals would differ, and to identify whether the debit or credit column of the trial balance would have the larger total.

Explanation of Solution

Errors affecting trial balance:

An error is a mistake committed in the process of book-keeping or in accounting. In most of the cases, when an error occurs it affects the trial balance. The debit total, and credit total of the trial balance will not be equal. In such cases, the error must be found, and corrected. 

Errors not affecting trial balance:

An error is a mistake committed in the process of book-keeping or in accounting.  In some cases, errors may occur but, they will not affect the totals of the trial balance. Such an error can be found while preparing the trial balance or would be indicated by the unusual account balance. For Example, Crediting land account. If such errors have already been journalized, and posted to the ledger, then they should be corrected by preparing a correcting journal entry.

1.

As a credit to accounts payable account of $6,000 was not posted, it would cause the trial balance to be out of balance by an amount of $6,000, and the debit column of the trial balance would have the larger total.

2.

Though, an entry of debiting accounts receivable account, and crediting fees earned account by $5,300 was not posted, it would not cause the trial balance to be out of balance by any amount, and the totals in the debit column, and the credit column of the trial balance would be equal...

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Chapter 2 Solutions

Financial And Managerial Accounting
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