The following errors were found in the books of Bell Traders:
-Credit sales $536 to V. Bennett was omitted from the books.
-$758 discount received was mistakenly debited to Discount Received Account.
-$530 discount allowed was entered in error as $503 in T. Wilson’s account.
-There was a bank overdraft of $626 which was entered in error in the bank account as $662.
-A discount received of $474 was entered in the cash book but was not entered in S. Riddick account who was a creditor.
-A credit sale of $2,000 to G. Jones had been omitted from the accounts.
-A machine bought for cash $1,000 as a fixed asset was entered to Purchases book.
1. Journalize the correction of the above errors.
2. Post the relevant entries to Suspense account.
3. Enter in Suspense account the figure which represented the original difference in the Trial Balance.
3.The figure which represented the original difference in the Trial Balance is $1033.
The following Details were extracted from the books of Angene Bisor;
October 1 Debit balances for Sales Ledger 3,050
Credit balances for Sales Ledger 150
Credit balances for Purchases Ledger 12,500
Debited balances for Purchases Ledger 925
Totals for the month ending October 31, 2007
Credit sales 10,050
Cash and cheques received 7,100
Bad Debts written off 375
Discounts Allowed 250
Returns Inwards 500
Dishonoured cheques from customers 700
Purchases Journal 15,750
Cheques paid to suppliers 17,500
Discount Received 870
Returns Outwards 300
(A)Enter up the Sales Ledger Control accounts and The Purchases Ledger Control Accounts for October 2007.
(B)From which books would the total of Credit Sales, Discount allowed, and Returns Inwards be taken.
Items for entry in Control Account Source
Total Credit Sales The Sales Journal
Discounts Allowed The Cash Book
Returns Inwards The Returns Inwards Journal
The Following is a summary of the bank account in the Cash Book of X. Wethernorth for the month of April 2001.
You are informed that:
-Bank charges of $70 shown on the bank statement have not been entered in the cash book.
-Four cheques in the sums of $100, $150, $125 and $175 have not been presented to the bank
-A Standing Order for Utilities of $200 was paid by the bank but not entered to the cash book.
-A customers cheque for $400 was returned by the bank marked “refer to drawer”. No entry was made in the cash book.
-The bank did not credit Wethernorth’s current account with a lodgement of $ 2,500 made on April 30 2001.
-Two customers D. Mark and F. Garvey deposited $200 and $300 respectively directly into the current account of Wethernorth.
(a)Show the adjustments you will make in Wethernorth’s Cash Book.
(b)Prepare a Bank Reconciliation Statement as at April 30, 2001 to show the Bank Statement balance.