Question
Correction of Errors Graces trial balance did not balance, the debits exceeded the credits by $1 560. A suspense account was opened for the difference.
Correction of Errors
Graces trial balance did not balance, the debits exceeded the credits by $1 560. A suspense account was opened for the difference. You are asked to help and after inspection of the ledgers the following errors were found.
- $2 500 received from sales of old motor vehicle had been entered in the Sales Account.
- Purchases day book had been overcast by $200.
- A cheque of $1 900 from A. Brent was accidentally credited to A. Brians account.
- The owner took $2 800 worth of goods out of the business purchases.
- Bank charges $440 entered in the cash book have not been posted to the bank charges account.
- A sale of goods to R Christie $4 600 was correctly entered in the Cash Book but entered in the personal account ad $6 400.
Required:
a. The Net profit originally calculated for the previous year was $56 800. Show your calculation of the correct figure. (6 marks)
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Financial Accounting Tools for business decision making
Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso
6th Edition
978-1119191674, 047053477X, 111919167X, 978-0470534779
