Working with the Takeaways Part A Each of the following accounts from the Canam Company has a normal balance as of December 31, 2019 , the end of Canam's first year of operations.

Required 

Prepare a trial balance for Canam Company as of December 31, 2019.

Part B Landers Distributors was formed to serve as a distributor of fine furnishings imported from overseas manufacturers. Assume the following trial balance was prepared as of December 31, 2019, at the end of Landers' first year of operations:

It is apparent that there is an error somewhere in the company's accounts since the sum of the debit account balances \((\$ 360,250)\) does not equal the sum of the credit account balances \((\$ 378,500)\). After further research, we learn the following:

1. A cash purchase of \(\$ 20,000\) in inventory, occurring near year-end, was not recorded.

2. By mistake, \(\$ 10,000\) that should have been recorded as Accounts Payable was recorded as Notes Payable.

3. Acredit of \(\$ 16,000\) was accidentally recorded in the Wage Expense account rather than in Sales Revenue.

4. A sale on account of \(\$ 18,750\) was correctly recorded as Sales Revenue, but the other side of the entry was mistakenly never recorded.

Required

a. Which of the four errors, if any, is the reason that the trial balance is not in balance?

b. Which of the errors, if any, must be corrected?

c. Prepare a corrected trial balance.

Transcribed Image Text:

Cash... $ 100 Common stock $1,500 Accounts receivable. 300 Dividends 100 Inventory... 250 Sales revenue.. 800 Property, plant, and equipment. 1,750 Selling expenses 300 Accounts payable... 150 Administrative expenses.. 50 Notes payable... 400