Dao Vang, CPA, was retained by Universal Cable to prepare financial statements for April 2014. Vang accumulated all the ledger balances per Universal”s records and found the following.
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UNIVERSAL CABLE Trial Balance April 30, 2014 |
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|
Cash Accounts Receivable Supplies Equipment |
Debit |
Credit |
|
$ 4,100 |
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Accumulated Depreciation—Equip. |
$ 1,350 |
|
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Accounts Payable |
2,100 |
|
|
Salaries and Wages Payable |
700 |
|
|
Unearned Service Revenue |
890 |
|
|
Owner”s Capital |
12,900 |
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|
Service Revenue |
5,450 |
|
|
Salaries and Wages Expense |
3,300 |
|
|
Advertising Expense |
600 |
|
|
Miscellaneous Expense |
290 |
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|
Depreciation Expense |
500 |
|
|
$23,390 |
$23,390 |
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Dao Vang reviewed the records and found the following errors.
1. Cash received from a customer on account was recorded as $950 instead of $590.
2. A payment of $75 for advertising expense was entered as a debit to Miscellaneous Expense $75 and a credit to Cash $75.
3. The first salary payment this month was for $1,900, which included $700 of salaries payable on March 31. The payment was recorded as a debit to Salaries and Wages Expense $1,900 and a credit to Cash $1,900. (No reversing entries were made on April 1.)
4. The purchase on account of a printer costing $310 was recorded as a debit to Supplies and a credit to Accounts Payable for $310.
5. A cash payment of repair expense on equipment for $96 was recorded as a debit to Equipment $69 and a credit to Cash $69.
Instructions
(a) Prepare an analysis of each error showing (1) the incorrect entry, (2) the correct entry, and (3) the correcting entry. Items 4 and 5 occurred on April 30, 2014.
(b) Prepare a correct trial balance.