12 Trial Balance and Rectification
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Workbook [email protected] Trial Balance & Rectification (Solved) 50 Unit 5 TBR # 5.1 Make Trial Balance from mixed transactions of ABC at year-end (June 30th, 2006) ABC Company Adjusted Trial Balance As on June 30 th , 2006 Description Amount Description Amount Description Amount Account Payable $ 200 Owner Equity $ 300 Land $ 200 Account Receivables 350 Cost of Goods Sold 820 Long-term Debts 1,300 Accrued Liabilities 150 Dep. Expense 110 Prepaid Expenses 40 Acc. Depreciation 250 Interest Expense 80 Salaries Expense 660 Building 1,400 Unearned Revenue 130 Sales Revenue 2,400 Cash 120 Interest Revenue 50 Rent Expense 400 Income Tax Expense 110 Inventories 610 Retained Earning 120 ABC Company Trial Balance As on June 30 th , 2006 S. No Description Ref Amount ($) Dr. Cr. 1 Account Payable 200 2 Account Receivables 350 3 Accrued Liabilities 150 4 Acc. Depreciation 250 5 Building 1,400 6 Cash 120 7 Income Tax Expense 110 8 Owner Equity 300 9 Cost of Goods Sold 820 10 Dep. Expense 110 11 Interest Expense 80 12 Unearned Revenue 130 13 Interest Revenue 50 14 Inventories 610 15 Land 200 16 Long-term Debts 1,300 17 Prepaid Expenses 40 18 Salaries Expense 660 19 Sales Revenue 2,400 20 Rent Expense 400 21 Retained Earning 120 Total Rs. 4,900 Rs. 4,900
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Trial Balance and Rectification
Transcript of 12 Trial Balance and Rectification
Workbook
[email protected] Trial Balance & Rectification (Solved)
50
Unit 5
TBR # 5.1 Make Trial Balance from mixed transactions of ABC at year-end (June 30th, 2006)
ABC Company
Adjusted Trial Balance As on June 30th, 2006
Description Amount Description Amount Description Amount Account Payable $ 200 Owner Equity $ 300 Land $ 200 Account Receivables 350 Cost of Goods Sold 820 Long-term Debts 1,300 Accrued Liabilities 150 Dep. Expense 110 Prepaid Expenses 40 Acc. Depreciation 250 Interest Expense 80 Salaries Expense 660 Building 1,400 Unearned Revenue 130 Sales Revenue 2,400 Cash 120 Interest Revenue 50 Rent Expense 400 Income Tax Expense 110 Inventories 610 Retained Earning 120
ABC Company Trial Balance
As on June 30th, 2006
S. No Description Ref Amount ($)
Dr. Cr. 1 Account Payable 200 2 Account Receivables 350 3 Accrued Liabilities 150 4 Acc. Depreciation 250 5 Building 1,400 6 Cash 120 7 Income Tax Expense 110 8 Owner Equity 300 9 Cost of Goods Sold 820
10 Dep. Expense 110 11 Interest Expense 80 12 Unearned Revenue 130 13 Interest Revenue 50 14 Inventories 610 15 Land 200 16 Long-term Debts 1,300 17 Prepaid Expenses 40 18 Salaries Expense 660 19 Sales Revenue 2,400 20 Rent Expense 400 21 Retained Earning 120
Total Rs. 4,900 Rs. 4,900
Workbook
[email protected] Trial Balance & Rectification (Solved)
51
Unit 5
TBR # 5.2 Prepare a Trial Balance for Shining Brothers Pvt. Ltd. at March 31st, 2008.
Shining Brothers Pvt. Ltd.
Adjusted Trial Balance As on March 31st, 2008
Description Amount Description Amount Description Amount
Bank Loan Rs. 14,000 Insurance Expense Rs. 7,300 Equipments Rs. 40,000 Marketable Security 6,500 Owner's Investments 95,000 Maintenance Exp. 5,000 Bill Payable 1,000 Rent & Rates Expense 400 Miscellaneous Expenses 4,800 Unearned Revenue 3,500 Acc. Dep. _ Equipments 14,000 Accrued Expenses 1,500 Sundry Debtors 12,000 Accrued Revenue 15,000 Dep. Exp. _ Equipments 2,000 Outstanding Salaries 2,500 Machinery 25,000 Unexpired Insurance 8,500 Prepaid Rent 2,000 Drawings 3,500 Vendor's Payables 500
Shining Brothers Pvt. Ltd. Adjusted Trial Balance As on March 31st, 2008
S. No Description Ref Amount (Rs.)
Dr. Cr. 1 Bank Loan 14,000 2 Marketable Security 6,500 3 Bill Payable 1,000 4 Unearned Revenue 3,500 5 Sundry Debtors 12,000
6 Outstanding Salaries 2,500 7 Prepaid Rent 2,000 8 Insurance Expense 7,300 9 Owner's Investments 95,000 10 Rent & Rates Expense 400 11 Accumulated Dep. _ Equipments 14,000 12 Accrued Revenue 15,000 13 Machinery 25,000 14 Drawings 3,500 15 Equipments 40,000 16 Maintenance Exp. 5,000 17 Miscellaneous Expenses 4,800 18 Accrued Expenses 1,500 19 Depreciation Exp. _ Equipments 2,000 20 Unexpired Insurance 8,500 21 Vendor's Payables 500
Total Rs. 132,000 Rs. 132,000
Workbook
[email protected] Trial Balance & Rectification (Solved)
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Unit 5
TBR # 5.3 There are several Mistakes in the Umer & Brothers (Pvt.) Ltd. Trial Balance. You are requested to identify Errors and make corrected Trial Balance.
S. No Heads of Accounts Ref Debit Credit
1 Umer Owner Equity 1,551
2 Umer Drawings 560 3 Equipments 2,850
4 Sales 2,850 5 Due from Customers 530 6 Purchases 1,260
7 Purchase Return 364
8 Bank Loan 996
9 Creditors 528 10 Taxes 720
11 Cash in Hand 226
12 Note Payable 680
13 Inventory 264
14 Repair 461
15 Return Inward 98
Total Rs. 7,649 Rs. 6,289
S. No Heads of Accounts Ref Debit Credit
1 Umer Owner Equity 1,551
2 Umer Drawings 560
3 Equipments 2,850
4 Sales 2,850
5 Due from Customers 530
6 Purchases 1,260
7 Purchase Return 364
8 Bank Loan 996
9 Creditors 528
10 Taxes 720
11 Cash in Hand 226
12 Note Payable 680
13 Inventory 264
14 Repair 461
15 Return Inward 98
Total Rs. 6,969 Rs. 6,969
Workbook
[email protected] Trial Balance & Rectification (Solved)
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Unit 5
TBR # 5.4 Correct following Trial Balance.
Ahmed Trial Balance
As on 31st, December, 1997
S. No Heads of Accounts Ref Amount (Rs.)
Dr Cr 1 Ahmed Owner's Equity 1,556 2 Ahmed Drawing 564 3 Leasehold Premises 750 4 Sales 2,750 5 Due from Customer 530 6 Purchases 1,259 7 Purchases Return 264 8 Loan from Bank 256 9 Creditors 528
10 Trade Expenses 700 11 Cash 226 12 Bill Payable 100 13 Salaries and Wages 600 14 Stock (1.1.97) 264 15 Rent and Rates 463 16 Sales Return 98
Total Rs. 5,454 Rs. 5,454
Ahmed
Trial Balance As on 31st, December, 1997
S. No Heads of Accounts Amount (Rs.)
Dr Cr 1 Ahmed Owner's Equity 1,556 2 Ahmed Drawing 564 3 Leasehold Premises 750 4 Sales 2,750 5 Due from Customer 530 6 Purchases 1,259 7 Purchases Return 264 8 Loan from Bank 256 9 Creditors 528
10 Trade Expanses 700 11 Cash 226 12 Bill Payable 100 13 Salaries and Wages 600 14 Stock (1.1.97) 264 15 Rent and Rates 463 16 Sales Return 98
Total Rs. 5,454 Rs. 5,454
Workbook
[email protected] Trial Balance & Rectification (Solved)
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Unit 5
TBR # 5.5 The clerk of ABC business wrongly prepared the following Trial Balance. You are required to draw up a
trial balance correctly.
S. No Heads of Accounts Ref Amount (Rs.)
Dr Cr 1 Owner's Equity 60,000 2 Opening Stock 5,000 3 Discount Allowed 500 4 Commission Received 700 5 Fixed Assets 60,000 6 Sales 85,000 7 Purchases 45,000 8 Purchases Return 1,000 9 Sales Return 2,000
10 Carriage Inward 700 11 Carriage Outward 600 12 Wages & Salaries 25,000 13 Bill Receivables 7,000 14 Debtors 9,000 15 Bill Payable 7,000 16 Rent 3,000 17 Interest Paid 2,000 18 Cash 800 19 Creditors 6,900 20 Ending Stock 33,800
Total Rs. 177,500 Rs. 177,500
S. No Heads of Accounts Ref
Amount (Rs.) Dr Cr
1 Owner's Equity 60,000 2 Opening Stock 5,000 3 Discount Allowed 500 4 Commission Received 700 5 Fixed Assets 60,000 6 Sales 85,000 7 Purchases 45,000 8 Purchases Return 1,000 9 Sales Return 2,000 10 Carriage Inward 700 11 Carriage Outward 600 12 Wages & Salaries 25,000 13 Bill Receivables 7,000 14 Debtors 9,000 15 Bill Payable 7,000 16 Rent 3,000 17 Interest Paid 2,000 18 Cash 800 19 Creditors 6,900
Total Rs. 160,600 Rs. 160,600
Workbook
[email protected] Trial Balance & Rectification (Solved)
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Unit 5
TBR # 5.6 The Make corrected Trial Balance after anticipating hidden errors.
Karachi international Trial Balance
As on 31st December, 2007
S. No Heads of Accounts Ref
Amount (Rs.)
Dr Cr
1 Owner's Equity 60,000
2 Inventory 01-01-2007 3,000
3 Wages 500
4 Commission earned 700
5 Tangible Assets 60,000
6 Sales 85,000
7 Purchases 45,000
8 Return Outward 1,000
9 Sales Return 2,000
10 Carriage Inward 700
11 Fuel and Power Expense 600
12 Wages & Salaries 25,000
13 Note Receivables 7,000
14 Account Receivable 9,000
15 Bill Payable 5,000
16 Rent 3,000
17 Discount Allowed 2,000
18 Cash 800
19 Creditors 6,900
20 Ending Inventory 33,800
Total Rs. 175,500 Rs. 175,500
Errors:
(i) Credit sales of worth Rs. 4,500 was omitted to record in the book of original entry.
(ii) Wages and Salaries account should be separate to Rs. 15,000 and 10,000 respectively.
(iii) Drawing of worth Rs. 2,000 wrongly charged to Note Receivable Account.
(iv) Unearned Sales of Rs. 15,000 was incorrectly credited to Sales Account.
Following accounts are used for correction and adjusting the transactions.
Sales; Account Receivable; Wages; Salaries; Drawing; Note Receivable; Unearned Sales
Workbook
[email protected] Trial Balance & Rectification (Solved)
56
Unit 5
Karachi international
Trial Balance As on 31st December, 2007
S. No Heads of Accounts Ref
Amount (Rs.)
Dr Cr
1 Owner's Equity 60,000
2 Inventory 01-01-2007 3,000
3 Wages 15,500
4 Commission earned 700
5 Tangible Assets 60,000
6 Sales 74,500
7 Purchases 45,000
8 Return Outward 1,000
9 Sales Return 2,000
10 Carriage Inward 700
11 Fuel and Power Expense 600
12 Salaries 10,000
13 Note Receivables 5,000
14 Account Receivable 13,500
15 Bill Payable 5,000
16 Rent 3,000
17 Discount Allowed 2,000
18 Cash 800
19 Creditors 6,900
20 Drawing 2,000
21 Unearned Sales 15,000
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Total Rs. 163.100 Rs. 163.100 Calculations:
Sales 85,000 + 4,500 - 15,000 = Rs. 74,500
Account Receivable 9,000 + 4,500 = 13,500
Wages 500 + 15,000 = 15,500
Salaries 10,000 = 10,000
Drawing 2,000 = 2,000
Note Receivable 7,000 - 2,000 = 5,000
Unearned Sales 15,000 = 15,000
Workbook
[email protected] Trial Balance & Rectification (Solved)
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Unit 5
TBR # 5.7 Pass Rectification entries for the following transactions at end April, 2009.
1. A builder’s bill for Rs. 4,600 for the erection of a small shed was debited to Repairs Expense Account.
2. Repairs to plant amounting to Rs. 900 had been charged to Plant and Machinery Account.
3. Purchase Day Book undercast by Rs. 1,000.
4. Check for Rs. 750 received from Hussain Ltd. Was credit to account of Hassan Ltd.
5. The total of Return Inward Book has been overcast Rs. 2,000.
6. Goods to the value of Rs. 4,000 returned by X were included in closing stock, but no entry was made in the books.
7. Sales Day Book undercast by Rs. 500
8. General expenses Rs. 18 was posted as Rs. 80.
General Journal
Date Account Title and Explanations Ref
Amount (Rs)
Debit Credit
2009
April 1 Building 4,600 Repair Expense 4,600 (Building account rectify) 2 Repair Expense 900
Plant and Machinery 900
(Repair expense was wrongly charged to P & M)
3 Purchases 1,000 Suspense Account 1,000 (Purchase day book undercast) 4 Account Receivable_Hassan 750 Account Receivable_ Hussain 750
(Account Receivable Rectified)
5 Suspense Account 2,000
Return Inward 2,000
(Return inward book adjusted )
6 Sales Return 4,000
Account Receivable_ X 4,000
(Sales return omitted has been recorded)
7 Suspense Account 500 Sales 500 (Sales day book rectified)
8 Suspense Account 62 General Expenses 62 (General expenses rectified)
Total Rs. 13,812 Rs. 13,812
Workbook
[email protected] Trial Balance & Rectification (Solved)
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Unit 5
TBR # 5.8 Pass Rectification entries for the following transactions at end January, 2010.
1. Purchase of furniture for Rs. 615 passed through Purchase Book.
2. The motor car had been purchased for Rs. 3.400. Cash had been correctly credited but Motor Car account had been
debited with Rs. 3,140 only.
3. Interest on deposits received Rs. 60 had been debited in cash account, but had been not credited to the interest
account.
4. The balance in the Account Receivable_ Ali Rs. 100 had been written off as bad but no other account had been
debited.
5. Rs. 7,700 paid for wages to workman for making showcases had been charged to wages account.
6. Bill Payable Book overcast by Rs. 500.
7. Goods purchased for proprietor’s use for Rs. 1,000 was debited to purchase account.
General Journal
Date Account Title and Explanations Ref
Amount (Rs)
Debit Credit
2010
Jan 1 Furniture 615 Purchases 615 (Furniture account rectify) 2 Motor Car 260
Suspense Account 260
(Motor car account adjusted)
3 Suspense Account 60 Interest 60 (unrecorded amount recorded in interest received) 4 Bad debt 100
Suspense Account 100
(Bad debt omission recorded)
5 Furniture 7,700
Wages 7,700
(Furniture account rectified)
6 Bill Payable 500
Suspense Account 500
(Bill payable book rectified)
7 Drawing 1,000 Purchases 1,000 (Paid expenses)
Total Rs. 10,235 Rs. 10,235
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