10. All the journal entries shown below contain errors. The entries were prepared by an employee of Helena Corporation who does not have an adequate knowledge of accounting.

INSTRUCTIONS Examine the journal entries carefully to locate the errors. Prepare journal entries to correct the errors. Assume that Office Supplies and Office Equipment were recorded at the correct values.

However, the items were purchased with cash. Check 1026 was properly processed in the accounting records and was for the January 3, 20X1, items purchased. Assume the errors are found and corrected on the last day of the month.

Analyze: After the correcting journal entries have been posted, what effect do the correcting entries have on the reported assets of the company?

Date General Journal Description Page 1 Post. Ref. Debit Credit 20X1 Jan. 1 Accounts Payable Fees Income 2,200.00 2,200.00 Performed services on credit 2 Cash Telephone Expense Paid for January telephone service, check 1601 3 Office Equipment Office Supplies Accounts Payable Purchased file cabinet and office supplies, check 1062 1,500.00 1,500.00 2,500.00 500.00 3,000.00