A Gail Dawson is the owner of a retail business. She has employed an inexperienced bookkeeper
to maintain her accounting records.
(a) On 31 March 20X9, the end of the business's accounting year, the bookkeeper extracted the
(b ~—
following trial balance from the business’s records:

Required:
1 A corrected version of Gail Dawson’s trial balance dated 31 March 20X9 based on the above
information, but with an amended figure for the suspense account.
The following errors were found in the accounting system after a corrected version of the trial
balance above was prepared.
(‘) The total of the sales day book for December 20X8 had been overstated by £120.
(i/) In January 20X9 some new office equipment had been purchased for £360; this had been
debited to the purchases account.
(iii) A payment by cheque to a creditor, £216, had been entered in the books as £261.
(iv) A credit note for £37 sent to a customer had been overlooked.
(v) The owner had withdrawn a cheque for £80 for private use in October 20X8; both the
bank and drawings account had been credited with this amount.
Required:
In the books of Gail Dawson
2 Journal entries to correct each of these errors.
(Note: narratives are NOT required.)
3 The suspense account. (Start with the amount in the corrected trial balance given in answer
to Required 1 above, and include any entries arising from the correction of the errors.)
4 An explanation of the term ‘error of commission’. (Give an example of such an error to illus

Transcribed Image Text:

Trial Balance at 31 March 20X9 Dr Fixed assets at cost 18,300 Provision for depreciation of fixed assets, 1 April 20X8 2,800 Stocks 1 April 20X8 3,700 31 March 20X9 Trade debtors 2,960 1,825 Trade creditors 864 Balance at bank (overdrawn) 382 Capital Drawings Sales 26,860 7,740 26,080 Purchases 18,327 Running expenses Provision for doubtful debts Suspense 66,860 6,904 90 16,888 66,860