A company had the following account balances at year-end:

If all of the accounts have normal balances, what are the totals for the trial balance?

Question

A company had the following account balances at year-end:

If all of the accounts have normal balances, what are the totals for the trial balance?

Quizplus · Accepted Answer

To find the totals of the trial balance, we simply add up all the account balances.

Total = 
$40,000 (cash) +
$15,000 (accounts receivable) +
$16,800 (supplies) +
$12,000 (prepaid rent) +
$21,000 (equipment) +
$10,000 (accumulated depreciation) +
$2,000 (accounts payable) +
$8,000 (wages payable) +
$3,000 (unearned revenue) +
$4,000 (common stock) +
$3,000 (retained earnings) =
$135,800

However, since all of the accounts have normal balances, we need to subtract the credit balances (accounts payable, wages payable, unearned revenue) and the accumulated depreciation (which is a contra-asset account with a credit balance) from the total.

Total = $135,800 - $2,000 - $8,000 - $3,000 - $10,000 =
$112,800

Therefore, the best choice is C.

A Company Had the Following Account Balances at Year-End