The trial balance of Smart Tots Child Care does not balance. (Click the icon to
ID: 2607966 • Letter: T
Question
The trial balance of Smart Tots Child Care does not balance. (Click the icon to view the trial balance.) The following errors are detected: (Click the icon to view the errors.) Prepare the corrected trial balance as of August 31, 2017. Journal entries are not required. 1 More Info a. Cash is understated by $1,700. b. A S4,700 debit to Accounts Receivable was posted as a credit. c. A S800 purchase of office supplies on account was neither journalized nor posted d. Equipment was incorrectly transferred from the ledger as $89,900. It should have been transferred as $82,000. e. Salaries Expense is overstated by $100. f. A S700 cash payment for advertising expense was neither journalized nor posted g. A $150 owner's withdrawal of cash was incorrectly journalized as $1,500 h. Service Revenue was understated by $4,600. i. A 12-month insurance policy was posted as a $1,500 credit to Prepaid Insurance. Cash was posted correctly Print DoneExplanation / Answer
Solution :- Corrected Trial Balance
Notes :- i). Accounts receivable = 4700 * 2
= $ 9400.
ii). Equipment (overstated) = 89900 - 82000
= $ 7900.
iii). Drawings (Overstated) = 1500 - 150 = 1350.
Account Title Debit ($) Credit ($) Cash 1500 Office supplies 800 Accounts Receivable 9400 Equipment (Overstated) 7900 Prepaid insurance 1500 Advertising expense 700 Salary expense (Overstated) 50 Service Revenue 4600 Drawings (Overstated) 1350 Total 13900 13900