How Accounting Errors Impact Trial Balance Totals
Which of the following errors would cause the trial balance totals to be unequal?
a. A payment of $576 for a supplier was posted as a debit of $567.10 to Supplies Expense and a credit of $567 to Cash.
b. A receipt of $3691 from a customer was posted as a debit of $5961 to Cash and a credit of $5961 to Inventory.
c. A payment of $3391 to a creditor was neglected to be journalized.
d. A payment of $583 for a telephone bill received last week was posted as a credit of $583 to Accounts Payable and a debit of $583 to Cash.
e. A check received from a customer on account was posted as a credit of $120 to Cash, $120 to Income from Services, and a debit of $220 to Accounts Receivable.
Answer:
Error a is credited with a lesser amount than debited, error c is not accounted for, error d is misposted, and error e is not balanced out due to an additional debit entry. Errors a, c, d, and e cause the trial balance totals to be unequal.
The trial balance totals are considered unequal when there is an imbalance between total debits and total credits. Let's delve into each scenario to understand the impact of these errors:
Error a: The supplier payment was posted incorrectly, with a credit of $567 instead of the correct amount of $576. This creates a difference of $9, causing the trial balance to be unequal.
Error b: This scenario involves a correct posting where Cash is debited with $5961 and Inventory is credited with the same amount. Therefore, this error does not cause imbalance in the trial balance totals.
Error c: The payment to a creditor was neglected to be recorded, leading to an imbalance in the overall balance totals as this transaction is missing from the accounting records.
Error d: The payment for the telephone bill was misposted, resulting in a reversal of credit and debit amounts. This misposting creates an imbalance in the trial balance totals.
Error e: In this case, two debits totaling $220 were recorded, but only $120 was credited. This discrepancy causes the trial balance to be unequal due to the unbalanced entry.
Therefore, errors a, c, d, and e can lead to unequal trial balance totals, while error b does not.
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