The accountant for Sweetwater Laundry prepared the following unadjusted and adjusted trial balances. Assume that all balances in the unadjusted trial balance and the amounts of the adjustments are correct. Identify the errors in the accountant’s adjusting entries.
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Tomahawk Services Co. Trial Balance July 31, 2008 |
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|
Unadjusted |
Adjusted |
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|
Debit |
Credit |
Debit |
Credit |
|
|
Balances |
Balances |
Balances |
Balances |
|
|
Cash |
7,500 |
7,500 |
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|
Accounts Receivable |
18,250 |
22,000 |
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Laundry Supplies |
3,750 |
5,500 |
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Prepaid Insurance* |
5,200 |
1,400 |
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Laundry Equipment |
140,000 |
134,000 |
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Accumulated Depreciation |
|
48,000 |
|
48,000 |
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Accounts Payable |
|
9,600 |
9,600 |
|
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Wages Payable |
1,200 |
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Mattie Ivy, Capital |
60,300 |
60,300 |
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Mattie Ivy, Drawing |
28,775 |
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Laundry Revenue |
24 |
182,100 |
182,100 |
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|
Wages Expense |
49,200 |
|
49,200 |
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|
Rent Expense |
25,575 |
|
25,575 |
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Utilities Expense |
18,500 |
18,500 |
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Depreciation Expense |
|
6,000 |
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Laundry Supplies Expense |
|
1,750 |
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Insurance Expense |
|
800 |
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Miscellaneous Expense |
3,250 |
3,250 |
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|
300,000 |
300,000 |
304,250 |
301,200 |
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*$3,800 of insurance expired during the year.