Valley Realty acts as an agent in buying, selling, renting, and managing real estate. The unadjusted trial balance on July 31, 2016, follows:

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2.77K viewsOctober 26, 2016

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Darshita 6.14K October 26, 2016 0 Comments

Valley Realty

UNADJUSTED TRIAL BALANCE

August 31, 2016

	ACCOUNT TITLE	DEBIT	CREDIT
1	Cash	52,500.00
2	Accounts Receivable	100,100.00
3	Prepaid Insurance	12,600.00
4	Office Supplies	2,800.00
5	Land
6	Accounts Payable		21,000.00
7	Unearned Rent
8	Notes Payable
9	Common Stock		17,500.00
10	Retained Earnings		70,000.00
11	Dividends	44,800.00
12	Fees Earned		591,500.00
13	Salary and Commission Expense	385,000.00
14	Rent Expense	49,000.00
15	Advertising Expense	32,200.00
16	Automobile Expense	15,750.00
17	Miscellaneous Expense	5,250.00
18	Totals	700,000.00	700,000.00

The following business transactions were completed by Valley Realty during August 2016. Enter the transactions through the 23rd on Page 18 of the two-column journal:

Aug.	1	Purchased office supplies on account, $3,150.
	2	Paid rent on office for month, $7,200.
	3	Received cash from clients on account, $83,900.
	5	Paid insurance premiums, $12,000.
	9	Returned a portion of the office supplies purchased on August 1, receiving full credit for their cost, $400.
	17	Paid advertising expense, $8,000.
	23	Paid creditors on account, $13,750.

Enter the remaining transactions on Page 19 of the two-column journal:

Aug.	29	Paid miscellaneous expenses, $1,700.
	30	Paid automobile expense, $2,500.
	31	Discovered an error in computing a commission during July; received cash from the salesperson for the overpayment, $2,000.
	31	Paid salaries and commissions for the month, $53,000.
	31	Recorded revenue earned and billed to clients during the month, $183,500.
	31	Purchased land for a future building site for $75,000, paying $7,500 in cash and giving a note payable for the remainder.
	31	Paid dividends, $1,000.
	31	Land purchased on August 31 used by a local university as a parking lot during football season (September, October, and November); received advance payment of $5,000.

	Required:
1.	Record the August 1, 2016, balance of each account in the appropriate balance column of a four-column account, typeBalance in the item section, and select a check mark in the Posting Reference column.
2.	Journalize the transactions for August in a two-column journal beginning on Page 18. Refer to the Chart of Accounts for exact wording of account titles.
3.	Post to the ledger, extending the account balance to the appropriate balance column after each posting. Post in chronological order. For transactions occurring on the same day, post in the order presented in the instructions. Insert the appropriate posting references in both the journal and the ledger as each item is posted.
4.	Prepare an unadjusted trial balance of the ledger as of August 31, 2016.
5.	Assume that the August 31 transaction for dividends should have been $10,000. (a) Why did the unadjusted trial balance in (4) balance? (b) Journalize the correcting entry on August 31. Use page 20. (Note: You will not be required to post this entry to the ledger at this time.) (c) Is this error a transposition or slide?

X

Journal

Shaded cells have feedback.

2. Journalize the transactions for August in a two-column journal beginning on Page 18. Refer to the Chart of Accounts for exact wording of account titles.

All transactions on this page must be entered (except for post ref(s)) before you will receive Check My Work feedback.

PAGE 18PAGE 19

JOURNAL

1 Answer

score 0 · Answer 1 · 2016-10-26T01:53:52+00:00

Date	Description		Debit	Credit
Aug
1	Office Supplies	14	3150
	Accounts Payable	21		3150

2	Rent Exp	52	7200
	Cash	11		7200

3	Cash	11	83900
	Accounts recivable	12		83900

5	Prepaid Insurance	13	12000
	Cash	11		12000

9	Accounts Payable	21	400
	Office Supplies	14		400

17	Advertise Exp	53	8000
	Cash	11		8000

23	Accounts Payable	21	13750
	Cash	11		13750

29	Misc. Exp	59	1700
	Cash	11		1700

30	Automobile Exp	54	2500
	Cash	11		2500


31	Cash	11	2000
	salary and commisson Exp	51		2000


31	salary and commisson Exp	51	53000
	Cash	11		53000

Cash
					Balance
Aug	iteam	Post Ref	Debit	Credit	Debit	Credit
1	Balance				52500
2		18		7200	45300
3		18	83900		129200
5		18		12000	117200
17		18		8000	109200
23		18		13700	95400
29		19		1700	93750
30		19		2500	91250
31		19	2000		93250
31		19		53000	40250
31		19		7500	32750
31		19		1000	31750
31		19	5000		36750




Accounts Rec
					Balance
Aug	iteam	Post Ref	Debit	Credit	Debit	Credit
1	Balance				10100
3		18		83900	16200
11		19	183500		199700

Prepaid Insurance
					Balance
Aug	iteam	Post Ref	Debit	Credit	Debit	Credit
1	Balance				12600
5		18	12000		24600


Office Supplies
					Balance
Aug	iteam	Post Ref	Debit	Credit	Debit	Credit
1	Balance				2800
1		18	3150		5950
9		18		400	5550



Accounts payable
					Balance
Aug	iteam	Post Ref	Debit	Credit	Debit	Credit
1	Balance					21000
1		18		3150		24150
9		18	400			23750
23		18	13750			10000

Unearned Rent
					Balance
Aug	iteam	Post Ref	Debit	Credit	Debit	Credit
31	Balance	19		5000		5000




Notes payable
					Balance
Aug	iteam	Post Ref	Debit	Credit	Debit	Credit
1	Balance
31		19		37500		67500

Valley reality
Unadjusted Trial balance
Unadjusted Trial balance	Debit	Credit
Cash	36750
Accounts recivable	199700
Prepaid Insurance	24600
Office Supplies	5550
Land	75000
Accounts Payable		10000
Unearned Rent		5000
Notes Payable		67000
Cindy gatement Capital		87000
Cindy gatement Drawing	45000
fees Earned		775000
Salary	436000
rent	56200
Advertise	40200
Automobile	18250
Misc	6950
	945000	945000

1 Answer

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