Correcting Errors in a Trial Balance
The trial balance for Kilda Services, Inc., at the end of July appears at the top of the opposite page. It does not balance because of a number of errors. Kilda’s accountant compared the amounts in the trial balance with the ledger, recomputed the account balances, and compared the postings.
He found the following errors:
a. The balance of Cash was understated by $400.
b. A cash payment of $420 was credited to Cash for $240.
c. A debit of $120 to Accounts Receivable was not posted.
d. Supplies purchased for $60 were posted as a credit to Supplies.
e. A debit of $180 to Prepaid Insurance was not posted.
