Accounting Business Reporting for Decision Making

148 Accounting: Business Reporting for Decision Making

4.12 Summarise the procedures you would undertake if an accounting worksheet does

not balance. LO5, 9

4.13 Illustrate three scenarios of incorrect recordings that may cause a trial balance to

not balance. LO9

4.14 Can errors still exist in the trial balance if the sum of the debit and credit columns

equals the same amount? If so, provide an example. LO9

Exercises

 BASIC |   MODERATE |    CHALLENGING

4.15  LO8, 9

You are the bookkeeper for Haute Fashions and on review of the business’s records and reports

you realise that the trial balance does not balance. Your supervisor has asked you to investigate

why this might have occurred. Explain with examples what type of errors would have caused the

trial balance not to balance.

4.16  LO4

Classify each of the following according to whether it is an asset, liability or equity account. Apply

your learning from the definitions in chapter 1 to provide a justification for each classification.

a. Accounts receivable

b. Stationery

c. Bank loan

d. Profit

e. Interest expense

f. Sales

g. Rent revenue

h. Inventory

i. Property, plant and equipment

j. Cleaning expense

k. Service fees

l. Bank fees

4.17  LO4

Using your knowledge of the accounting equation, solve the missing values in the following table.

Assets = Liabilities + Equity

200 000 = 46 000 + a.

b. = 66 000 + 140 000

250 000 = c. + 46 000

17 800 = 11 600 + d.

4.18   LO4

Determine the missing entries.

Current

assets

Non-current

assets

Current

liabilities

Non-current

liabilities Capital Income Expense

$ 5 000 $ 9 000 $6 000 $ 1 400 $3 000 a. $ 5 000

7 000 5 000 2 000 3 000 2 000 26 000 b.

21 000 61 000 9 000 12 000 c. 60 100 41 000