The trial balance of You Build Inc. at December 31, 2017, does not balance.

Requirements
1. How much out of balance is the trial balance? Determine the out-of-balance amount. The error lies in the Accounts Receivable account. Add the out-of-balance amount to, or subtract it from, Accounts Receivable to determine the correct balance of Accounts Receivable.
2. You Build Inc. also failed to record the following transactions during December:
a. Purchased additional land for $60,000 by signing a note payable.
b. Earned service revenue on account, $10,000.
c. Paid salary expense of $1,400.
d. Purchased a TV advertisement for $1,000 on account. This account will be paid during January.
Add these amounts to, or subtract them from, the appropriate accounts to properly include the effects of these transactions. Then prepare the corrected trial balance of You Build Inc.
3. After correcting the accounts, advise the top management of You Build Inc. on the company's:
a. Total assets
b. Total liabilities
c. Net income or loss

Transcribed Image Text:

Cash 3,900 Share capital. 7,200 Retained earnings $20,000 7,300 9,100 3,400 34,000 Service revenue Accounts payable. Note payable 5,800 Salary expense 5,000 Advertising expense