Elite Realty acts as an agent in buying, selling, renting, and managing real estate. The unadjusted trial balance on March 31, 2019, follows:   Elite Realty UNADJUSTED TRIAL BALANCE March 31, 2019     ACCOUNT TITLE DEBIT CREDIT 1 Cash 25,800.00   2 Accounts Receivable 58,900.00   3 Prepaid Insurance 2,900.00   4 Office Supplies 1,500.00   5 Land     6 Accounts Payable   12,700.00 7 Unearned Rent     8 Notes Payable     9 Lester Wagner, Capital   41,000.00 10 Lester Wagner, Drawing 1,500.00   11 Fees Earned   242,600.00 12 Salary and Commission Expense 145,300.00   13 Rent Expense 35,000.00   14 Advertising Expense 16,600.00   15 Automobile Expense 5,000.00   16 Miscellaneous Expense 3,800.00   17 Totals 296,300.00 296,300.00       The following business transactions were completed by Elite Realty in April 2019. Enter the transactions through the 23rd on Page 18 of the two-column journal: Apr. 1 Paid rent on office for a month, $6,000.   2 Purchased office supplies on account, $2,300.   5 Paid insurance premiums, $5,300.   10 Received cash from clients on account, $52,100.   15 Purchased land for a future building site for $197,000, paying $30,000 in cash and giving a note payable for the remainder.   17 Paid creditors on account, $5,950.   20 Returned a portion of the office supplies purchased on April 2, receiving full credit for their cost, $350.   23 Paid advertising expense, $4,450.   Enter the following transactions on Page 19 of the two-column journal: Apr. 27 Discovered an error in computing a commission; received cash from the salesperson for the overpayment, $3,000.   28 Paid automobile expense (including rental charges for an automobile), $1,700.   29 Paid miscellaneous expenses, $1,500.   30 Recorded revenue earned and billed to clients during the month, $54,000.   30 Paid salaries and commissions for the month, $13,500.   30 Withdrew cash for personal use, $4,000.   30 Rented land purchased on April 15 to local merchants association for use as a parking lot in May and June, during a street rebuilding program; received advance payment of $11,000.     Required: 1. Record April 1, 2019, the balance of each account in the appropriate balance column of a four-column account, type Balance in the item section, and select a checkmark in the Posting Reference column. 2. Journalize the transactions for April in a two-column journal beginning on Page 18. Refer to the Chart of Accounts for the exact wording of account titles. 3. Post to the ledger, extending the account balance to the appropriate balance column after each posting. Post in chronological order. For transactions occurring on the same day, post in the order presented in the instructions. Insert the appropriate posting references in both the journal and the ledger as each item is posted. 4. Prepare an unadjusted trial balance of the ledger as of April 30, 2019.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Elite Realty acts as an agent in buying, selling, renting, and managing real estate. The unadjusted trial balance on March 31, 2019, follows:
 
Elite Realty
UNADJUSTED TRIAL BALANCE
March 31, 2019
 
  ACCOUNT TITLE DEBIT CREDIT
1
Cash
25,800.00
 
2
Accounts Receivable
58,900.00
 
3
Prepaid Insurance
2,900.00
 
4
Office Supplies
1,500.00
 
5
Land
 
 
6
Accounts Payable
 
12,700.00
7
Unearned Rent
 
 
8
Notes Payable
 
 
9
Lester Wagner, Capital
 
41,000.00
10
Lester Wagner, Drawing
1,500.00
 
11
Fees Earned
 
242,600.00
12
Salary and Commission Expense
145,300.00
 
13
Rent Expense
35,000.00
 
14
Advertising Expense
16,600.00
 
15
Automobile Expense
5,000.00
 
16
Miscellaneous Expense
3,800.00
 
17
Totals
296,300.00
296,300.00
 
 
 
The following business transactions were completed by Elite Realty in April 2019. Enter the transactions through the 23rd on Page 18 of the two-column journal:
Apr. 1 Paid rent on office for a month, $6,000.
  2 Purchased office supplies on account, $2,300.
  5 Paid insurance premiums, $5,300.
  10 Received cash from clients on account, $52,100.
  15 Purchased land for a future building site for $197,000, paying $30,000 in cash and giving a note payable for the remainder.
  17 Paid creditors on account, $5,950.
  20 Returned a portion of the office supplies purchased on April 2, receiving full credit for their cost, $350.
  23 Paid advertising expense, $4,450.
 
Enter the following transactions on Page 19 of the two-column journal:
Apr. 27 Discovered an error in computing a commission; received cash from the salesperson for the overpayment, $3,000.
  28 Paid automobile expense (including rental charges for an automobile), $1,700.
  29 Paid miscellaneous expenses, $1,500.
  30 Recorded revenue earned and billed to clients during the month, $54,000.
  30 Paid salaries and commissions for the month, $13,500.
  30 Withdrew cash for personal use, $4,000.
  30 Rented land purchased on April 15 to local merchants association for use as a parking lot in May and June, during a street rebuilding program; received advance payment of $11,000.
 
  Required:
1. Record April 1, 2019, the balance of each account in the appropriate balance column of a four-column account, type Balance in the item section, and select a checkmark in the Posting Reference column.
2. Journalize the transactions for April in a two-column journal beginning on Page 18. Refer to the Chart of Accounts for the exact wording of account titles.
3. Post to the ledger, extending the account balance to the appropriate balance column after each posting. Post in chronological order. For transactions occurring on the same day, post in the order presented in the instructions. Insert the appropriate posting references in both the journal and the ledger as each item is posted.
4. Prepare an unadjusted trial balance of the ledger as of April 30, 2019.
5.

Assume that the April 30 transaction for salaries and commissions should have been $15,300. (a) Why did the unadjusted trial balance in (4) balance? (b) Journalize the correcting entry on April 30. Use page 20. (Note: You will not be required to post this entry to the ledger at this time.) (c) Is this error a transposition or slide?

 

 

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