EX 2-20 Errors in trial balance

Identify the errors in the following trial balance. All accounts have normal balances.

Mascot Co. Unadjusted Trial balance For the Month Ending july 31, 2016 Debit balances Credit   balances Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36,000 Accounts Receivable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 112,600 Prepaid Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18,000 Equipment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 375,000 Accounts Payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53,300 Salaries Payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,500 Common Stock  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100,000 Retained Earnings  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 197,200 Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,000 Service Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 682,000 Salary Expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 396,800 Advertising Expense. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73,000 Miscellaneous Expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,600 1,189,300 1,189,300

Answer:

1. The Debit column total is added incorrectly. The sum is $890,700 rather than 

$1,189,300. 

2. The trial balance should be dated “July 31, 2016,” not “For the Month 

Ending July 31, 2016.” 

3. The Accounts Receivable balance should be in the Debit column. 

4. The Accounts Payable balance should be in the Credit column. 

5. The Dividends balance should be in the Debit column. 

6. The Advertising Expense balance should be in the Debit column. 

A corrected trial balance would be as follows: 

MASCOT CO. 

Unadjusted Trial Balance 

July 31, 2016 

Debit 

Balances 

Credit 

Balances 

Cash 36,000 

Accounts Receivable 112,600 

Prepaid Insurance 18,000 

Equipment 375,000 

Accounts Payable 53,300 

Salaries Payable 7,500 

Common Stock 100,000 

Retained Earnings 197,200 

Dividends 17,000 

Service Revenue 682,000 

Salary Expense 396,800 

Advertising Expense 73,000 

Miscellaneous Expense 11,600 

1,040,000 1,040,000