After Preparing an (Unadjusted) Trial Balance at Year-End,
G

question 52

Essay

After preparing an (unadjusted) trial balance at year-end,
G. Chu of Chu Design Company discovered the following errors:
1. Cash payment of the $225 telephone bill for December was recorded twice.
2. Cash payment of a note payable was recorded as a debit to Cash and a debit to Notes
Payable for $1,000.
3. A $900 cash dividend was recorded to the correct accounts as $90.
4. An additional investment of $5,000 cash by the owner was recorded as a debit to Common
Stock and a credit to Cash.
5. A credit purchase of office equipment for $1,800 was recorded as a debit to the Office
Equipment account with no offsetting credit entry.
Using the form below, indicate whether the error would cause the trial balance to be out of balance by placing an X in either the yes or no column.
$$\begin{array} { | c | l | l | l | } \hline \text { Error } & \text { Yes } & & \text { No } \\\hline 1 . & & & \\\hline 2 . & & & \\\hline 3 . & & & \\\hline 4 . & & & \\\hline 5 . & & & \\\hline\end{array}$$

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Definitions:

Economic Differences

Variations in economic conditions or performance, typically among countries, regions, or sectors.

Multinational Corporations

Corporations that own or control production of goods or services in one or more countries other than their home country.

Threat Of Expropriation

The risk that a government will seize private assets or significantly alter their value through regulations or other actions.

Inventory Holdings

The total value or quantity of all the goods a company has in stock, representing a significant component of its assets.