The following general journal entries (presented in a simplified format) were made recently by the bookkeeper of Morgan€™s Gas Emporium:

Required:
(a) Briefly describes the transaction that resulted in each of these journal entries.
(b) Suppose that the bookkeeper inadvertently recorded the third entry by debiting Notes Payable and crediting Equipment, each for $4,000. How would this error have affected the assets and liabilities of Morgan€™s Gas Emporium?
(c) How would the error in part (b) affect the trial balance prepared at the end of the period for Morgan€™s Gas Emporium?

Transcribed Image Text:

General Journal Debit Credit 400 270 Description Supplies 400 Cash Interest Expense 270 Cash Equipment 4,000 Notes Payable 4,000