Elite Realty acts as an agent in buying, selling, renting, and managing real estate. The unadjusted trial balance on March 31, 2018, follows:   Elite Realty UNADJUSTED TRIAL BALANCE March 31, 2018     ACCOUNT TITLE DEBIT CREDIT 1 Cash 26,300.00   2 Accounts Receivable 61,500.00   3 Prepaid Insurance 3,000.00   4 Office Supplies 1,800.00   5 Accounts Payable   14,000.00 6 Common Stock   10,000.00 7 Retained Earnings   36,000.00 8 Dividends 2,000.00   9 Fees Earned   240,000.00 10 Salary and Commission Expense 148,200.00   11 Rent Expense 30,000.00   12 Advertising Expense 17,800.00   13 Automobile Expense 5,500.00   14 Miscellaneous Expense 3,900.00   15 Totals 300,000.00 300,000.00       The following business transactions were completed by Elite Realty during April 2018. Enter the transactions through the 23rd on Page 18 of the two-column journal: Apr. 1 Paid rent on office for month, $6,500.   2 Purchased office supplies on account, $2,300.   5 Paid insurance premiums, $6,000.   10 Received cash from clients on account, $52,300.   15 Purchased land for a future building site for $200,000, paying $30,000 in cash and giving a note payable for the remainder.   17 Paid creditors on account, $6,450.   20 Returned a portion of the office supplies purchased on April 2, receiving full credit for their cost, $325.   23 Paid advertising expense, $4,300.   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, $2,500.   28 Paid automobile expense (including rental charges for an automobile), $1,500.   29 Paid miscellaneous expenses, $1,400.   30 Recorded revenue earned and billed to clients during the month, $57,000.   30 Paid salaries and commissions for the month, $11,900.   30 Paid dividends, $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 $10,000.     Required: 1. Record the April 1, 2018, balance of each account in the appropriate balance column of a four-column account, type Balance in the item section, and select a check mark 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 exact wording of account titles. Insert the appropriate posting references in both the journal and the ledger as each item is posted. 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, 2018. 5. Assume that the April 30 transaction for salaries and commissions should have been $19,100. (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? CHART OF ACCOUNTS Elite Realty General Ledger   ASSETS 11 Cash 12 Accounts Receivable 13 Prepaid Insurance 14 Office Supplies 16 Land   LIABILITIES 21 Accounts Payable 22 Unearned Rent 23 Notes Payable   EQUITY 31 Common Stock 32 Retained Earnings 33 Dividends   REVENUE 41 Fees Earned   EXPENSES 51 Salary and Commission Expense 52 Rent Expense 53 Advertising Expense 54 Automobile Expense 59 Miscellaneous Expense

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
icon
Concept explainers
Question
Elite Realty acts as an agent in buying, selling, renting, and managing real estate. The unadjusted trial balance on March 31, 2018, follows:
 
Elite Realty
UNADJUSTED TRIAL BALANCE
March 31, 2018
 
  ACCOUNT TITLE DEBIT CREDIT
1
Cash
26,300.00
 
2
Accounts Receivable
61,500.00
 
3
Prepaid Insurance
3,000.00
 
4
Office Supplies
1,800.00
 
5
Accounts Payable
 
14,000.00
6
Common Stock
 
10,000.00
7
Retained Earnings
 
36,000.00
8
Dividends
2,000.00
 
9
Fees Earned
 
240,000.00
10
Salary and Commission Expense
148,200.00
 
11
Rent Expense
30,000.00
 
12
Advertising Expense
17,800.00
 
13
Automobile Expense
5,500.00
 
14
Miscellaneous Expense
3,900.00
 
15
Totals
300,000.00
300,000.00
 
 
 
The following business transactions were completed by Elite Realty during April 2018. Enter the transactions through the 23rd on Page 18 of the two-column journal:
Apr. 1 Paid rent on office for month, $6,500.
  2 Purchased office supplies on account, $2,300.
  5 Paid insurance premiums, $6,000.
  10 Received cash from clients on account, $52,300.
  15 Purchased land for a future building site for $200,000, paying $30,000 in cash and giving a note payable for the remainder.
  17 Paid creditors on account, $6,450.
  20 Returned a portion of the office supplies purchased on April 2, receiving full credit for their cost, $325.
  23 Paid advertising expense, $4,300.
 
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, $2,500.
  28 Paid automobile expense (including rental charges for an automobile), $1,500.
  29 Paid miscellaneous expenses, $1,400.
  30 Recorded revenue earned and billed to clients during the month, $57,000.
  30 Paid salaries and commissions for the month, $11,900.
  30 Paid dividends, $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 $10,000.
 
  Required:
1. Record the April 1, 2018, balance of each account in the appropriate balance column of a four-column account, type Balance in the item section, and select a check mark 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 exact wording of account titles. Insert the appropriate posting references in both the journal and the ledger as each item is posted.
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, 2018.
5. Assume that the April 30 transaction for salaries and commissions should have been $19,100. (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?
CHART OF ACCOUNTS
Elite Realty
General Ledger
  ASSETS
11 Cash
12 Accounts Receivable
13 Prepaid Insurance
14 Office Supplies
16 Land
  LIABILITIES
21 Accounts Payable
22 Unearned Rent
23 Notes Payable
  EQUITY
31 Common Stock
32 Retained Earnings
33 Dividends
  REVENUE
41 Fees Earned
  EXPENSES
51 Salary and Commission Expense
52 Rent Expense
53 Advertising Expense
54 Automobile Expense
59 Miscellaneous Expense
(b) Journalize the comecting entry on April 30. Use page 20. (Note: You will not be required to post this entry to the ledger at this time.)
Question not attempted.
JOURNAL
ACCOUNTING EQUATION
DATE
DESCRIPTION
POST. REF.
DEBIT
CREDIT
ASSETS
LIABILITIES
EQUITY
2
Transcribed Image Text:(b) Journalize the comecting entry on April 30. Use page 20. (Note: You will not be required to post this entry to the ledger at this time.) Question not attempted. JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST. REF. DEBIT CREDIT ASSETS LIABILITIES EQUITY 2
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps

Blurred answer
Knowledge Booster
Completing the Accounting Cycle
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education