II.

Ozamiz Parking Space

Trial Balance
September 20, 2017

DEBIT CREDIT
Cash P 97,000
Accounts Receivable 65,000
Supplies Inventory 15,000
Accounts Payable P 21,000
Dolor, capital 100,000
Dolor, drawing 2,000
Parking Revenue 70,000
Salaries Expense 9,000
Advertising Expense 3,000
TOTAL P 191,000 P 191,000

There were errors committed, but leaving the trial balance to still be in balance:

1. P10,000 additional cash investment of Dolor was erroneously recorded as revenue earned.
2. Personal withdrawal of Dolor was erroneously booked-up as salaries expense in the amount of
P4,000.
3. Payment to an account was erroneously debited to Accounts Receivable in the amount of
P5,000.
4. P6,000 collection from a customer’s account was charged to credit to Accounts Payable instead
of Accounts Receivable.

Required:
1 JOURNALIZE THE CORRECTING ENTRIES.
2. PREPARE A CORRECTED TRIAL BALANCE FOR THE MONTH OF SEPTEMBER.

III.
1. A P45,000 payment for a new computer was recorded by a debit to Office Equipment of P4,500
and a credit to Cash of P4,500.
2. An Accounts Payable was paid by issuing a check for P27,000. The payment was recorded by
debiting Accounts Payable P27,000 and crediting Accounts Receivable by P27,000.
3. An Accounts Receivable in the amount of P625 was collected in full. The collection was recorded
by a debit to Cash for P625 and a credit to Accounts Payable for P625.
4. An Advances to Employees account was erroneously debited to Drawing Account of P5,000 and
credited to cash, P5,000.
5. An equipment which was one of the investment by the owner was erroneously charged to Notes
Payable instead to Capital Account. The amount of debit, which was correct, was P60,000, while
the amount of credit was P600,000.

REQUIRED: COMPLETE THE TABLE BELOW:

ENTRY MADE SHOULD-BE ENTRY CORRECTING ENTRY

IV. For each of the following cases, state whether the error would cause the debit and credit columns
of the trial balance to have unequal totals. Write either "EQUAL" or "UNEQUAL".
a. A P5,400 payment for a new typewriter was recorded by a debit to Office Equipment of P540 and a
credit to Cash of P540.
b. A payment of P4,000 to a creditor was recorded by a debit to Accounts Payable of P4,000 and a credit
to cash of P400.
c. An accounts receivable in the amount of P8,000 was collected in full . The collection was recorded by a
debit to cash for P8,000 and a debit to Accounts Payable for P8,000.
d. An accounts payable was paid by issuing a check for P3,500. The payment was recorded by debiting
Accounts Payable P3,500 and crediting Accounts Receivable P3,500.

V. The trial balance prepared by Geraldine Fernandez Company as at September 30 was not in balance.
In searching for the error, an employee discovered that a transaction for the purchase of a typewriter on
credit for P6,100 has been recorded by debit of P6,100 to the Office Equipment Account and a debit of
P6,100 to Accounts Payable. The credit column of the incorrect trial balance had a total of P926,000.

State whether the following accounts were "OVERSTATED", "UNDERSTATED", or "CORRECTLY

STATED":

1. Office Equipment
2. debit column of the trial balance
3. Accounts Payable
4. credit column of the trial balance

VI. The following errors occurred in posting the transactions from journal to the ledger:
1. A payment of P1,700 for advertising was posted as a P1,700 debit to advertising expense and a
P7,100 credit to cash.
2. The receipt of P3,000 from a client on account was posted as a P3,000 debit to cash and a P3,000
credit to sales.
3. The purchase of supplies on account for P1,400 was posted twice as a debit to supplies and once as a
credit to accounts payable.
4. The payment of P2,200 to a creditor on account was posted as a credit to accounts payable for P2,200
and a credit to cash for P2,200.

Required:
1. Prepare a trial balance.
2. Answer the following questions:
a. Is the trial balance out of balance?
b. If not, how much is the difference between the column totals?
c. Which column total is larger?