Question

Exercise 4-12 Andrew Clark Company discovered the following errors made in January 2015. 1. 2. 3. A payment of Salaries and Wages Expense of $808 was debited to Equipment and credited to Cash, both for $808. A collection of $5,610 from a client on account was debited to Cash $561 and credited to Service Revenue $561. The purchase of equipment on account for $730 was debited to Equipment $370 and credited to Accounts Payable $370. Correct the errors by reversing the incorrect entry and preparing the correct entry. (Credit account titles are automatically indented when ama not indent manually.) Date Account Titles and Explanation Debit Credit (To reverse the incorrect entry.) (To record the correct entry) 2. (To reverse the incorrect entry.)

Answer 1

1) Journal entry

No	General journal	Debit	Credit
1	cash	808
	Equipment		808
	(To record reverse entry)
	Salaries and wages expense	808
	Cash		808
	(To record correcting entry)
2	Service revenue	561
	Cash		561
	(To reverse entry)
	Cash	5610
	Account receivable		5610
	(To record correct entry)
3	Account payable	370
	Equipment		370
	(To reverse entry)
	Equipment	730
	Account payable		730
	(to correct entry)

2) Journal entry

No	General journal	Debit	Credit
1	Salaries and wages expense	808
	Equipment		808
	(To record correct entry)
2	Cash (5610-561)	5049
	Service revenue	560
	Account receivable		5610
	(To record correct entry)
3	Equipment	360
	Account payable		360
	(to correct entry)