The following trial balance of Blues Traveler Corporation does not balance. BLUES TRAVELER CORPORATION TRIAL BALANCE APRIL...

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Accounting

The following trial balance of Blues Traveler Corporation doesnot balance.
BLUES TRAVELER CORPORATION TRIAL BALANCE APRIL 30, 2017
Debit Credit
Cash 5912
Accounts Receivable 5240
Supplies 2967
Equipment 6100
Accounts Payable 7044
Common Stock 8000
Retained Earnings 2000
service revenue 5200
Office Expense 4320
24,539 22,244
1. Cash received from a customer on account was recorded (bothdebit and credit) as $1,380 instead of $1,830.
2. The purchase on account of a computer costing $3,200 wasrecorded as a debit to Office Expense and a credit to AccountsPayable.
3. Services were performed on account for a client, $2,250, forwhich Accounts Receivable was debited $2,250 and Service Revenuewas credited $225.
4. A payment of $95 for telephone charges was entered as a debitto Office Expense and a debit to Cash.
5. The Service Revenue account was totaled at $5,200 instead of$5,280. Instructions From this information prepare a correctedtrial balance.
Instructions
From this information prepare a corrected trial balance.

Answer & Explanation Solved by verified expert

4.2 Ratings (884 Votes)

Correct Trial balance is as follows:

	Debit	Credit
	$	$
Cash	$ 6,172.00
Accounts Receivable	$ 4,790.00
Supplies	$ 2,967.00
Equipment	$ 6,100.00
Accounts Payable		$ 7,044.00
Common Stock		$ 8,000.00
Retained Earnings		$ 2,000.00
Service Revenue		$ 7,305.00
Office Expenses	$ 1,120.00
Computer	$ 3,200.00
	$ 24,349.00	$ 24,349.00

Error 1: Cash will increase by 450, and accounts receivable will decrease by 450

Error 2: Purchase of computer on account is a capital expenditure. Hence Computer should be debited. Office expense to reduce by 3,200. Accounts payable correctly credited.

Error 3: Service revenue to increase by 2250-225 = 2025.

Error 4: Cash to be credited twice. Hence cash to be reduced by 190

Error 5: Service revenue to increase by 80

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