Day: September 22, 2024

A sole trader’s trial balance as at 13 October 2023 does not agree, with the debit side totalling £500 less than the credit side.

During November, the following errors are discovered:

1 The sales daybook for October had been undercast by £150
2 Rent received of £240 had been credited to the rent expense payables (accrual) account from the cash book
3 The allowance for doubtful debts for receivables, which decreased by £420, had been recorded in the allowance for doubtful debts for receivables account as an increase

Following the correction of these errors, the balance on the suspense account would be?

Select ONE answer:

1. £340 credit
2. £250 credit
3. £1,340 debit
4. £340 debit

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 1

1. Correct – DR £500 & CR £840 (Error 3) = DR £340 — > Error 1 requires a debit to the receivables account and a credit to sales with no effect on suspense. Error 2 is simply moving the credit from one account to another with no effect on suspense.
2. Not correct
3. Not correct
4. Not correct

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