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Accounts Test

Ashika, a sole trader, identified multiple errors in her accounting records on 1 March 2024, including incorrect entries in sales and purchases accounts. She also discovered discrepancies in her trial balance due to misallocated payments and unrecorded transactions. The document outlines the need for journal entries to correct these errors and prepare a suspense account for further adjustments.

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96 views4 pages

Accounts Test

Ashika, a sole trader, identified multiple errors in her accounting records on 1 March 2024, including incorrect entries in sales and purchases accounts. She also discovered discrepancies in her trial balance due to misallocated payments and unrecorded transactions. The document outlines the need for journal entries to correct these errors and prepare a suspense account for further adjustments.

Uploaded by

bukotangulube
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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2. Ashika is a sole trader.

On 1 March 2024, Ashika identified an error where


the sale of goods worth $200 to Kiha was not entered into the ledger
accounts.

On 1 March 2024, Ashika identified an error where the sale of goods worth
$200 to Kiha was entered into the sales journal as $250. Kiha’s account was
debited $250, and the sales account was credited $250.

On 1 March 2024, Ashika identified an error where goods sold to Kiha, for
$200, were debited to the sales account and credited to Kiha’s account.

On 1 March 2024, Ashika identified an error where goods were sold to Kiha
for $200, but the entry was made in Dinah’s account in the sales ledger. The
transaction was entered correctly in the sales account.

On 1 March 2024, Ashika identified an error where $50 was paid for petrol,
but the entry was made in the vehicles account rather than the vehicle
expenses account. The transaction was entered correctly in the cash book.

Ashika sold $100 worth of goods to Steve and $200 worth of goods to Tony.
On 1 March 2024, Ashika identified that both of these transactions were
entered into the sales ledger accounts as $150. The transactions were
entered correctly into the sales account.

Prepare journal entries to correct the error. A narrative is required.


Error Date Detail Debit Credit
number
3. Ashika prepared a trial balance which balanced. However, she discovered
the following errors.

A) Payment of cash, $600, to Fran, a credit supplier, had been debited to the

account of Fred in the purchases ledger.

B) Rent paid by direct direct, $800, had not been recorded in the ledger

accounts.

C) Office expenses, $150, had been debited to the office equipment account.

D) Wages paid, $500, had been debited to the bank account and credited to

the wages account.

For each of the items, state the type of error that was made.

Error Name
4. Jonas prepared a trial balance on 31 March 2024 and the totals were not
equal. Credits were $590 higher than debits. The following errors were
identified.
1. Credit purchases of $850 to Nicki had been correctly entered in the
purchases
account, but credited as $580 in Nicki’s account.
2. The sales account had been overstated by $740.
3. Discount allowed, $400, had been credited to the discount received
account.
4. Vehicle expenses, $50, had been debited to the vehicles account.
5. A payment of $260 from a credit customer, Timmy, had been entered
correctly
into the cash book but had been debited to Timmy’s account.
6. Purchases returns, $160, had been entered correctly in the purchases
ledger but
had been omitted from the purchases returns account.
Prepare the suspense account to correct the errors. Start with the difference
on the trial balance.

Date Detail $ Date Detail $

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