Valley Realty

Unadjusted Trial Balance

July 31, 20Y8

Account No.Debit BalancesCredit Balances

Cash1111,860

Accounts Receivable1227,630

Prepaid Insurance131,350

Office Supplies14810

Land16

Accounts Payable21 7,820

Unearned Rent22

Notes Payable23

Common Stock31 10,000

Retained Earnings32 17,000

Dividends33940

Fees Earned41 134,780

Salary and Commission Expense51101,400

Rent Expense5213,480

Advertising Expense537,950

Automobile Expense542,430

Miscellaneous Expense591,750

169,600169,600

The following business transactions were completed by Valley Realty during August 20Y8:

Aug. 1.Purchased office supplies on account, $1,210.

2.Paid rent on office for month, $4,640.

3.Received cash from clients on account, $23,210.

5.Paid insurance premiums, $3,340.

9.Returned a portion of the office supplies purchased on August 1, receiving full credit for their cost, $190.

17.Paid advertising expense, $1,860.

23.Paid creditors on account, $4,180.

29.Paid miscellaneous expense, $420.

30.Paid automobile expense (including rental charges for an automobile), $1,390.

31.Discovered an error in computing a commission during July; received cash from the salesperson for the overpayment, $930.

31.Paid salaries and commissions for the month, $6,480.

31.Recorded revenue earned and billed to clients during the month, $27,850.

31.Purchased land for a future building site for $83,600, paying $9,200 in cash and giving a note payable for the remainder.

31.Paid dividends, $930.

31.Rented land purchased on August 31 to a local university for use as a parking lot during football season (September, October, and November); received advance payment of $2,790.

Required:

Use the attached spreadsheet to complete parts 1 and 3. Click on the Spreadsheet icon to open and save the Excel file to your computer. Your input into the spreadsheet will not be included in your grade in CengageNOW on this problem.

1. Record the August 1, 20Y8 balance of each account in the appropriate balance column of the four-column account. The word Balance has been entered in the item section and a check mark () has been placed in the Posting Reference column.

2. Journalize and insert the Posting References for the transactions for August in a two-column journal beginning on Page 18. For a compound transaction, if an amount box does not require an entry, leave it blank.

General JournalPage 18

DateDescriptionPost. Ref.DebitCredit

20Y8

Aug. 1

Aug. 2

Aug. 3

Aug. 5

Aug. 9

Aug. 17

Aug. 23

General JournalPage 19

DateDescriptionPost. Ref.DebitCredit

20Y8

Aug. 29

Aug. 30

Aug. 31-Error

Aug. 31-Salary

Aug. 31-Revenue

Aug. 31-Land

Aug. 31-Dividends

Aug. 31-Rent

Required:

3. Post to the ledger, extending the account balance to the appropriate balance column after each posting.

4. Using the balances from the spreadsheet, prepare an unadjusted trial balance of the ledger as of August 31, 20Y8.

List all accounts in the order of Assets, Liabilities, Stockholders equity, Revenues, and Expenses. If an amount box does not require an entry, leave it blank.

Valley Realty Unadjusted Trial Balance August 31, 20Y8

Account No.Debit BalancesCredit Balances

5a. Assume that the August 31 transaction for dividends should have been $4,680. As a result, the unadjusted trial balance in (4) would

5b. Assume that the August 31 transaction for dividends should have been $4,680. Journalize the correcting entry. If an amount box does not require an entry, leave it blank.

General JournalPage 19

DateDescriptionPost. Ref.DebitCredit

20Y8

Aug. 31

5c. Assume that the August 31 transaction for dividends should have been $4,680. Is this error a transposition or slide?