Asia is a trader. On 31 August 2023, she drew up her trial balance. The credit side was $273 higher than the debit side, so she entered the difference in a suspense account.
Asia later found these mistakes.
1 A credit purchase of $112 from Jacques had been entered twice in the purchases journal.
2 The wages account had been overcast by $300.
3 Cash received of $75 from Savanah, a trade receivable, had been recorded only in the cash book.
4 The August 2023 total from the sales returns journal, $198, had been credited to both the sales returns account and the purchases returns account.
5 A payment of $93 to Sophie had been entered in Sophie’s account as $39.
(a)[11]
Prepare the journal entries needed to correct errors 1-5. Narratives are not required.
(b)[5]
Prepare the suspense account, and include the original trial balance difference.
(c)[4]
Put a tick (✓) in the table to show how each error affects the accounts. The first error has already been done as an example.
Worked solution & mark scheme
This 20-mark question has a full step-by-step worked solution and mark scheme.