Reference no: EM132678563

Problem - The Colby Group has the following unadjusted trial balance as of August 31, 2019:

The Colby Group Unadjusted Trial Balance August 31, 2019
	Debit Balances	Credit Balances
Cash	17,300
Accounts Receivable	37,000
Supplies	7,400
Prepaid Insurance	1,900
Equipment	196,000
Notes Payable		97,600
Accounts Payable		26,000
Terry Colby, Capital		129,150
Terry Colby, Drawing	56,000
Fees Earned		454,450
Wages Expense	270,000
Rent Expense	51,800
Advertising Expense	25,200
Miscellaneous Expense	5,100
	667,700	707,200

The debit and credit totals are not equal as a result of the following errors:

a. The cash entered on the trial balance was understated by $6,000.

b. A cash receipt of $5,600 was posted as a debit to Cash of $6,500.

c. A debit of $11,000 to Accounts Receivable was not posted.

d. A return of $150 of defective supplies was erroneously posted as a $1,500 credit to Supplies.

e. An insurance policy acquired at a cost of $1,200 was posted as a credit to Prepaid Insurance.

f. The balance of Notes Payable was understated by $20,000.

g. A credit of $4,800 in Accounts Payable was overlooked when determining the balance of the account.

h. A debit of $7,000 for a withdrawal by the owner was posted as a credit to Terry Colby, Capital.

i. The balance of $58,100 in Rent Expense was entered as $51,800 in the trial balance.

j. Gas, Electricity, and Water Expense, with a balance of $24,150, was omitted from the trial balance.

Instructions -

1. Prepare a corrected unadjusted trial balance as of August 31, 2019.

2. Does the fact that the unadjusted trial balance in (1) is balanced mean that there are no errors in the accounts? Explain.