The Lexington Group Unadjusted Trial Balance May 31. 20Y6 Debit Balances Credit Balances Cash 20,350 Accounts Receivable 37,000 Supplies |1,100 Prepaid Insurance 200 Equipment Notes Payable 171,175 36,000 Accounts Payable 26,000 Common Stock 50,000 Retained Earnings Dividends 15,000 94,150 Fees Earned Wages Expense 270,000 | 429,850 Rent Expense 63,000 Advertising Expense 25,200 Miscellaneous Expense 5,100 608,125 636,000
Corrected
The Lexington Group has the following unadjusted trial balance as of
May 31. 20Y6:
The debit and credit totals are not equal as a result of the following
errors:
a. The cash entered on the trial balance was overstated by $7,000.
b. A cash receipt of $8,200 was posted as a debit to Cash of $2,800.
C. A debit of $ 16300 to Accounts Receivable was not posted.
d. A return of $ 125 of defective supplies was erroneously posted as a $
1.250 credit to Supplies
e. An insurance policy acquired at a cost of $3,600 was posted as a credit
to Prepaid Insurance.
f. The balance of Notes Payable was understated by $9,000.
g. A credit of $ 10,000 in Accounts Payable was overlooked when
determining the balance of the account
h. A debit of $5,000 for dividends was posted as a credit to Retained
Earnings.
i. The balance of $60,300 in Rent Expense was entered as $63,000 in the
trial balance.
j. Gas, Electricity, and Water Expense, with a balance of $16,350, was
omitted from the trial balance.
Instructions
1. Prepare a corrected unadjusted trial balance as of May 31, 2016.
2. Does the fact that the unadjusted trial balance in (1) is balanced mean
hat there are no errors in the accounts? Explain.
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