The bookkeeping system of Turner is not computerised, and at 30 September 2018 the bookkeeper was unable to balance the accounts. The trial balance totals were: Debit RM1,796,100
Question 1
The bookkeeping system of Turner is not computerised, and at 30 September 2018 the bookkeeper was unable to balance the accounts. The
Debit RM1,796,100
Credit RM1,852,817
Nevertheless, he proceeded to prepare draft financial statements, inserting the difference as a balancing figure in the
He then opened a suspense account for the difference and began to check through the accounting records to find the difference. He found the following errors and omissions:
1. RM8,980 – the total of the sales returns book for September 2018, had been credited to the purchases returns account.
2. RM9,600 paid for an item of plant purchased on 1 April 2018 had been debited to plant repairs account. The company depreciates its plant at 20% per annum on a straight line basis, with proportional
3. The cash discount totals for the month of September 2018 had not been posted to the general ledger accounts. The figures were:
Discount allowed RM836
Discount received RM919
4. RM580 insurance prepaid at 30 September 2017 had not been brought down as an opening balance.
5. The balance of RM38,260 on the telephone expense account had been omitted from the trial balance
6. A car held as a non-current asset had been sold during the year for RM4,800. The proceeds of sale were entered in the
Required:
(a) Open a suspense account for the difference between the trial balance totals. Prepare the
(b) Draw up a statement showing the revised profit after correcting the above errors.
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