Financial Accounting, Student Value Edition (5th Edition)
5th Edition
ISBN: 9780134728520
Author: Robert Kemp, Jeffrey Waybright
Publisher: PEARSON
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Chapter 2, Problem 8SC
To determine
Identify which of given option is correct regarding the error in
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Pixel Copies recorded a cash collection on account by debiting Cash and crediting Accounts Payable. What will the trial balance show for this error?
a. Cash is overstated
b. Liabilities are overstated
c. Expenses are overstated
d. The trial balance will not balance
Pixel Copies recorded a cash collection on account by debiting Cash and crediting Accounts Payable. What will the trial balance show for this error?
Cash is overstated
Liabilities are overstated
Expenses are overstated
The trial balance will not balance
A trial balance does not balance. The owner believes the following mistakes WOULD cause animbalance. Do you agree? (Answer TRUE or FALSE for each statement)
A. The owner forgot to record a cash saleB. A credit sale was recorded as a debit to sales and a debit to trade receivablesC. When transferring the bank overdraft from the Cash T account it was entered on thedebit side of the trial balanceD. Rates expense of £500 was debited to rent expenses and credited to cashE. A payment to a supplier of £690 was entered to cash as £690 but to trade payables as£609
Chapter 2 Solutions
Financial Accounting, Student Value Edition (5th Edition)
Ch. 2 - The order in which assets were listed and...Ch. 2 - Prob. 2DQCh. 2 - How is revenue related to retained earnings?Ch. 2 - Prob. 4DQCh. 2 - Prob. 5DQCh. 2 - Prob. 6DQCh. 2 - Prob. 7DQCh. 2 - Distinguish between journalizing and posting.Ch. 2 - True or false: If the trial balance is in balance,...Ch. 2 - When it is time to prepare the financial...
Ch. 2 - Which sequence of actions correctly summarizes the...Ch. 2 - Prob. 2SCCh. 2 - Prob. 3SCCh. 2 - Prob. 4SCCh. 2 - Prob. 5SCCh. 2 - Which journal entry records obtaining a bank loan...Ch. 2 - RV Wholesale, Inc., paid 1,200 for supplies and...Ch. 2 - Prob. 8SCCh. 2 - Prob. 9SCCh. 2 - Prob. 10SCCh. 2 - Prob. 11SCCh. 2 - Prob. 12SCCh. 2 - Prob. 1SECh. 2 - Prob. 2SECh. 2 - Prob. 3SECh. 2 - Prob. 4SECh. 2 - Accounting terminology (Learning Objectives 2, 3, ...Ch. 2 - Effects of debits and credits on accounts...Ch. 2 - Balancing accounts and normal balances (Learning...Ch. 2 - Types of accounts and effects of debits and...Ch. 2 - Re-creating journal entries from T-account...Ch. 2 - Journalizing transactions (Learning Objective 3)...Ch. 2 - Prob. 11SECh. 2 - Prob. 12SECh. 2 - Prob. 13SECh. 2 - Accounting terminology (Learning Objectives 1, 2,...Ch. 2 - Prob. 15AECh. 2 - Journalizing transactions (Learning Objective 3)...Ch. 2 - Prob. 17AECh. 2 - Balancing accounts and preparing a trial balance...Ch. 2 - Prob. 19AECh. 2 - Prob. 20AECh. 2 - Prob. 21AECh. 2 - Prob. 22AECh. 2 - Prob. 23BECh. 2 - Prob. 24BECh. 2 - Prob. 25BECh. 2 - Balancing accounts and preparing a trial balance...Ch. 2 - Recording transactions and preparing a trial...Ch. 2 - Prob. 28BECh. 2 - Prob. 29BECh. 2 - Prob. 30BECh. 2 - Prob. 31APCh. 2 - Prob. 32APCh. 2 - Journalizing, posting, and preparing a trial...Ch. 2 - Prob. 34APCh. 2 - Preparing a trial balance, income statement,...Ch. 2 - Prob. 36APCh. 2 - Prob. 37BPCh. 2 - Prob. 38BPCh. 2 - Prob. 39BPCh. 2 - Prob. 40BPCh. 2 - Prob. 41BPCh. 2 - Prob. 42BPCh. 2 - Prob. 1CECh. 2 - Prob. 1CPCh. 2 - Prob. 1CFSAPCh. 2 - Prob. 1EIACh. 2 - Prob. 2EIACh. 2 - Prob. 1FACh. 2 - Prob. 1IACh. 2 - Prob. 1SBACh. 2 - Prob. 1WC
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- Suppose we collected cash from a charge customer and the debit was to Cash and the credit to Sales. How and when would this error be discovered?arrow_forwardWhich of the following is not an advantage of the cash receipts journal? a. Transactions do not have to be posted on a regular basis. b. Transactions can be recorded on one line. c. Transactions involving debits to Cash are recorded in one place. d. Repetition in posting is eliminated. e. Special columns can be used for similar transactions.arrow_forwardFINDING AND CORRECTING ERRORS On May 25, after the transactions had been posted, Joe Adams discovered that the following entry contains an error. The cash received represents a collection on account, rather than new service fees. Correct the error in the general journal using a correcting entry.arrow_forward
- Which of these transactions requires a credit entry to Revenue? A. received cash from services performed this month B. collected balance due from customers C. received cash from bank loan D. refunded a customer for a defective productarrow_forwardIn a cash receipts journal, both the Accounts Receivable Credit column and the Cash Debit column were mistakenly underadded by 700. How will this error be discovered?arrow_forwardIdentify whether each of the following transactions, which are related to revenue recognition, are accrual, deferral, or neither. A. sold goods to customers on credit B. collected cash from customer accounts C. sold goods to customers for cash D. collected cash in advance for goods to be delivered laterarrow_forward
- The bookkeeper for Nevado Company has prepared the following trial balance: The bookkeeper has asked for your help. In examining the companys journal and ledger, you discover the following errors. Use this information to construct a corrected trial balance. a. The debits to the Cash account total 8,000, and the credits total 3,300. b. A 500 payment to a creditor was entered in the journal correctly but was not posted to the Accounts Payable account. c. The first two numbers in the balance of the Accounts Receivable account were transposed when the balance was copied from the ledger to the trial balance. d. The 1,500 amount withdrawn by the owner for personal use was debited to Miscellaneous Expense by mistakeit was correctly credited to Cash.arrow_forwardThe trial balance of Kelvin does not balance. Which TWO of the following errors could explain this, assuming that Kelvin maintains control accounts for its receivables and payables within the double entry system? (1) The sales day book was undercast by $100.(2) Discounts received were credited to sales revenue account.(3) An opening accrual was omitted from the rent account.(4) The debit side of the cash account was undercast. A (1) and (2)B (2) and (3)C (3) and (4)D (1) and (4) Please give solution with proper explanationarrow_forwardBusiness receives cash RO 180 from Ms. Asma was wrongly entered RO100 in both the accounts. This type of error is a. Errors of Commission b. Errors of transposition c. Reversal error d. Errors of Principlearrow_forward
- Which of the following errors will be detected by a trial balance? a. Posting a credit to Sales instead of the Accounts Payable b. Incorrecty computing the balance of the cash account c. Not journalizing a complete sales transaction d. Forgetting to post a complete purchase transactionarrow_forwardIdentify the two events from the following that cause a Petty Cash account to be credited in a journal entry. a. Fund amount is being reduced. c. Fund is being eliminated. b. Fund amount is being increased. d. Fund is being established.arrow_forwardA firm purchased telephone equipment for cash. By mistake, the accountant debitedUtilities Expense instead of Office Equipment. The error was discovered after the dataposted. The correcting entry should contain:arrow_forward
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