A sales return of $400 has been credited to the customer’s account as $40.
A suspense account is created to complete the trial balance.
What is the balance on the suspense account?
A $360 Credit
B $360 Debit
C $440 Credit
D $440 Debit
Customer account has been credited by $40 instead of $400.
Which means receivables are overstated.
As a result debit column exceeds credit column by $360 so suspense account of $360 credit is opened.
A suspense account shows a debit balance of $350.
What could have caused this?
A A purchase of $350 was debited to the rent account.
B A purchase of $350 was omitted from the purchases journal.
C A sale of $350 was debited to the sales account and credited to the sales ledger control account.
D The sales journal was overcast by $350.
The following errors were found after a suspense account was opened.
1 Motor repairs of $400 were credited to the motor vehicle at cost account.
2 A payment for electricity was debited in the electricity account as $2500 instead
3 A $450 cash purchase of goods for resale had been completely omitted from
4 Discount allowed of $50 had been debited to the discounts received account.
Which items would be entered in the suspense account?
The correction of which error would require an entry in the suspense account?
A $100 paid for vehicle repairs were debited to the vehicles account.
B A sales invoice for $45 was omitted from the sales journal.
C Drawings of $60 were debited in the cash book and were credited to the drawings account.
D Wages, $150, were correctly recorded in the wages account and debited in the cash book.
Which group would appear only on the credit side of a sales ledger control account?
A cash refunds, contras with the purchases ledger control accounts, sales
B cash refunds, contras with the purchases ledger contro! accounts, sales returns
C irrecoverable debts written off, cash received, discounts allowed
D irrecoverable debts written off, cash refunds, sales
The balance on a sales ledger control account was $21500. This did not agree with the total of the sales ledger account balances.
lt was discovered that a credit note for $200 sent to a credit customer had been posted to the debit of the customer's account.
What was the total of balances in the business's sales ledger before the error was corrected?
Which items appear in a sales ledger control account?
1 cash discount allowed
2 credit sales
3 payments to trade payables
4 returmms inwards
D 2, 3and4
Errors can exist in the preparation of both the sales ledger and the sales ledger control account.
Which error would require an adjustment in the sales ledger contro! account only to correct it?
A sales journal being overcast
B sales transaction amount originally entered incorrectly
C sales transaction omitted completely
D sales transaction recorded in wrong customer account
Why does a business keep a sales ledger control account?
1 It helps deter fraud.
2 It helps with the preparation of financial statements.
3. It identifies doubtful debt easily.
4 It predicts the sales for the coming year.
A sales ledger control account had a debit balance of $38 600. The total of individual sales ledger debit balances was $36 500. The only errors found were as follows.
An irrecoverable debt had been recorded in the ledger of Smith but not the control account.
The sales journal was undercast by $1500.
A contra of $1750 had been correctly recorded in the control account but only $1250 recorded in the ledgers.
What was the value of the irrecoverable debt?
Why is a sales ledger contro! account used?
1 to control discounts received
2 to ensure credit customers pay promptly
3 to provide a trial balance figure for trade receivables
What is not a purpose of control accounts?
A to assist in the preparation of financial statements
B to identify all errors where the trial balance agrees
Cito provide a total for trade receivables and trade payables
D to verify the accuracy of the individual ledger accounts
A book-keeper compared the business bank statement with the cash book. He then updated the cash book and finally prepared a bank reconciliation statement.
Why was the bank reconciliation statement prepared?
A to ensure no transactions had been omitted from the cash book
B to establish the value of unpresented cheques
C to explain the difference between the cash book balance and the bank statement balance
D to find out if any cheques had been dishonoured
The bank column of a cash book showed a credit balance of $5000. There were unpresented cheques amounting to $1500. The bank statement showed bank charges, $700, which were not recorded in the cash book.
What is the balance on the bank statement?
A $4200 credit
B $4200 debit
C $5800 credit
D $5800 debit