Question 1

Section A

A retail chain's trial balance fails to agree. The debit column totals $450,600 and the credit column totals $452,100. A suspense account is opened. It is later discovered that a cash sale of $750 was completely omitted from the books, and a payment for rent of $1,500 was credited to the bank but no debit entry was made. What is the balance on the suspense account after correcting these errors?

Accepted Answer

1. Find initial suspense balance: 452,100 (Cr) - 450,600 (Dr) = 1,500 shortage on Debit side. So, Suspense = 1,500 Dr. 2. Analyze errors: Omitted transaction = no TB impact. One-sided rent entry = requires Dr Rent 1,500, Cr Suspense 1,500. 3. Final balance = 1,500 Dr - 1,500 Cr = Nil.

Question 2

What mistakes do candidates make on this ACCA question?

Accepted Answer

Adjusting the suspense account for the completely omitted cash sale.

How to approach this question

Full Answer

Common mistakes

Practice the full ACCA FA — Financial Accounting Practice Exam 6

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