Mona Kamaka, CPA, was retained by Downtown TV Repair Ltd. to prepare financial statements for the month of March 2017. Mona accumulated all the ledger balances from the business records and found the following:

Mona reviewed the records and found the following errors:
1. Cash received from a customer on account was recorded as $570 instead of $750.
2. The purchase, on account, of equipment that cost $900 was recorded as a debit to Supplies and a credit to Accounts Payable for $900.
3. A payment of $30 for advertising expense was entered as a debit to Utilities Expense, $30, and a credit to Cash, $30.
4. The first salary payment this month was for $1,800, which included $600 of salaries and wages payable on February 28. The payment was recorded as a debit to Salaries and Wages Expense of $1,800 and a credit to Cash of $1,800. The business does not use reversing entries.
5. A cash payment for Repairs and Maintenance Expense on equipment for $90 was recorded as a debit to Equipment, $90, and a credit to Cash, $90.
Instructions
(a) Prepare an analysis of each error that shows
(1) The incorrect entry,
(2) The correct entry, and
(3) The correcting entry.
(b) Prepare a corrected trial balance.

Transcribed Image Text:

DOWNTOWN TV REPAIR LTD Trial Balance March 31, 2017 Debit Credit $7,200 3,500 Accounts receivable Supplies Equipment Accumulated depreciation-equipment Accounts payable Salaries and wages payable Unearned revenue Common shares Retained earnings Service revenue Salaries and wages expense Advertising expense Utilities expense Depreciation expense Repairs and maintenance expense 5 15,000 3,000 5,950 1,500 10,000 4,160 8,000 3,600 800 310 700 1,200 $33.210 $33,210