After Artie Company Had Completed All Posting for the Month

question 74

Essay

After Artie Company had completed all posting for the month of December, the sum of the balances in the following accounts payable subsidiary ledger did not agree with the balance of the control account in the general ledger.
Name Aston's
Address 286 Buck Avenue
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Date Item Post. Ref. Debit Credit Balance
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Dec. 2 P25 2,400 2,400
Name Carson Company
Address 818 Western Avenue
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Date Item Post. Ref. Debit Credit Balance
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Dec. 1 Balance 7,600
10 CP23 7,600 -
20 P32 3,300 3,300
29 J15 300 3,600
Name Diana Fenn Company
Address 90210 Baker Boulevard
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Date Item Post. Ref. Debit Credit Balance
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Dec. 1 Balance 9,900
18 CP28 9,900 -
29 P34 12,600 2,700
Name Maria Lopez
Address 2720 Sommers Avenue
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Date Item Post. Ref. Debit Credit Balance
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Dec. 8 P27 6,000 6,000
27 P33 8,000 14,000
Name Oster Supplies
Address 1560 Puckett Street
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Date Item Post. Ref. Debit Credit Balance
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Dec. 1 Balance 8,200
7 P26 5,600 13,800
12 J11 420 12,380
20 CP29 8,000 20,380
The balance in the Accounts Payable control account of $37,380 has been verified as correct. Also assume that the journals references in the Post Ref. columns of the accounts payable subsidiary ledger have been verified as correct.
Instructions
Determine the errors in the preceding accounts payable subsidiary accounts and prepare a corrected schedule of accounts payable.

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Definitions:

Normal Balance

In accounting, the normal balance is the side (debit or credit) of an account that is usually increased. For example, asset accounts normally have a debit balance, while liabilities and equity accounts have a credit balance.

Direct Write-off Method

A method of accounting for bad debts that involves charging the amount of an uncollectible account directly to the expense account when it is deemed non-recoverable.

Uncollectible Receivables

Debts owed to a company that are considered to be uncollectable and are written off as a loss.

Debit Balance

Occurs when the total of debits in an account exceeds the total of credits, which can be typical for accounts like expenses, assets, and losses.