Error Correction Template:

M2 Assignment

Module 02 Assignment
Instructions: Complete a brief analysis of what the current account balances are, and what they
should be according to Margaret’s CPA. Complete column G (Difference Analysis).
Mags and Bags				Mags and Bags		Difference Analysis
Trial Balance				Trial Balance-CPA Version
Account Number	Account	Debit	Credit	Debit	Credit
101	Checking	10,000		10,080		47,976.29
105	Accounts Receivable (A/R)	4,200		4,600
115	Merchandise Inventory	15,000		14,800
125	Prepaid Insurance	6,000		6,000
135	Vehicle	25,000		25,000
137	Accumulated Depreciation		5,000		5,000
201	Accounts Payable (A/P)		2,200		2,200
205	Loan Payable		0		0	5000
301	Common Stock		37,520		37,520
318	Retained Earnings		12,000		12,000
401	Sales		26,000		26,400	2500
501	Cost of Goods Sold	13,000		13,200
601	Advertising	2,500		2,500
603	Bank Charges	60		60
607	Depreciation Expense	5,000		5,000
609	Freight & Delivery	130		280
611	Insurance	0		0
621	Office Supplies	248		0		106.52
625	Repair & Maintenance	140		60
627	Shipping and delivery expense	592		442
629	Stationery & Printing	500		748
633	Telephone Expense	120		200		76.19
635	Utilities	230		150		79
		82,720	82,720	83,120	83,120	55,738
Address the following questions fully and completely. Use the details of your analysis above to
justify your responses. Write in complete sentences, and pay attention to spelling and grammar.

Q1: Identify which accounts are in error, and how they are related to each other.

Q4: Draft a brief response to Margaret sharing your findings and plan for how you will correct the errors in the computerized accounting software. Be specific in your findings and recommendations for correction. Include suggestions for how these types of errors can be avoided in the future.

Q2: Discuss the likely causes of the errors (omission, duplication, incorrect transaction date, etc.).

Q3: Looking forward, what tools will you use and actions will you take to ensure these errors don’t continue to be an issue in the company records?