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Suspense A/c Help!!

  • 28-02-2008 9:34pm
    #1
    Audio
    Closed Accounts Posts: 38 ✭


    Hi all,

    Im studying for the CIMA cert at the minute and having this problem with suspense accounts. I understand the concept pretty well however there is one specific example I dont understand. It talks about a mistake where the sales day book is undercast by say 200 quid. So obviously as a result sales is 200 lower and gross profit is less. The solution is to debit the suspense a/c and credit the sales a/c with the 200. Im confused though??? Whats happens the recievables a/c?? Surely that is going to be down 200 quid?? It also gets its total from the sales day book right??

    It seems to be like an error of omission but nowhere do they mention that recievables needs to be debited by 200??

    I hope this explains it.

    Any help would be greatly appreciated.

    Thanks,

    Stephen


Comments

  • #2
    acc grinds
    Registered Users, Registered Users 2 Posts: 55 ✭✭acc grinds


    the orginal entry was

    Dr Debtors
    Cr suspense

    To Fix it

    Dr Suspense
    Cr Sales


  • #3
    Audio
    Closed Accounts Posts: 38 ✭Audio


    Thank for the quick response. Im not sure I follow though. Are you assuming that the debtors/recievable a/c reflected the extra 200??

    The question in the example doesnt say that. It basically mentions about 10 errors that you have to remedy so there is no way of knowing whether or not this particular error has any impact on the trial balance difference.


  • #4
    Bren1609
    Closed Accounts Posts: 459 ✭✭Bren1609


    You need to know waht the original entry for that transaction was. If it's not given to you in the question the correct journal to rectify it should have been:

    Dr Debtors
    Cr Sales


  • #5
    Audio
    Closed Accounts Posts: 38 ✭Audio


    Thanks for that. Yeah that makes sense to me. In the book that I have they assume that the debtors a/c is correct.


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