Posting errors are identified in the following table. In column (1), enter the amount of the difference between the two trial balance columns (debit and credit) due to the error. In column (2), identify the trial balance column (debit or credit) with the larger amount if they are not equal. In column (3), identify the account(s) affected by the error. In column (4), indicate the amount by which the account(s) in column (3) is under- or overstated. Item (a) is completed as an example. (1)(2)(3)Identify(4)Difference betweenColumn withAmount ThatDebit and Creditthe LargerAccount(s)IncorrectlyAccount(s) IsDescription of Posting ErrorColumnsTotalOver- orStatedUnderstated$2,260$3,600 debit to Rent Expense isposted as a $1,340 debit.CreditRent ExpenseRent Expenseunderstated $2,260a.b.$6,500 credit to Cash is postedtwice as two credits to Cash.C.$10,900 debit to the Withdrawals account isdebited to Owner's Capital.d.$2,050 debit to Prepaid Insuranceis posted as a debit to Insurance Expense.$38,000 debit to Machinery isposted as a debit to Accounts Payable.е.f.$5,850 credit to Services Revenueis posted as a $585 credit.g.$1,390 debit to Store Supplies isnot posted.

The debit balance should always equal to credit balance for preparation of financial statements. The…

Answered: (1) (2) (3) Identify (4) Difference…

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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Posting errors are identified in the following table. In column (1), enter the amount of the difference between the two trial balance columns (debit and credit) due to the error. In column (2), identify the trial balance column (debit or credit) with the larger amount if they are not equal. In column (3), identify the account(s) affected by the error. In column (4), indicate the amount by which the account(s) in column (3) is under- or overstated. Item (a) is completed as an example.

(1)
(2)
(3)
Identify
(4)
Difference between
Column with
Amount That
Debit and Credit
the Larger
Account(s)
Incorrectly
Account(s) Is
Description of Posting Error
Columns
Total
Over- or
Stated
Understated
$2,260
$3,600 debit to Rent Expense is
posted as a $1,340 debit.
Credit
Rent Expense
Rent Expense
understated $2,260
a.
b.
$6,500 credit to Cash is posted
twice as two credits to Cash.
C.
$10,900 debit to the Withdrawals account is
debited to Owner's Capital.
d.
$2,050 debit to Prepaid Insurance
is posted as a debit to Insurance Expense.
$38,000 debit to Machinery is
posted as a debit to Accounts Payable.
е.
f.
$5,850 credit to Services Revenue
is posted as a $585 credit.
g.
$1,390 debit to Store Supplies is
not posted.

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