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Accounting help

  • 06-06-2010 1:17pm
    #1
    kev9100
    Registered Users, Registered Users 2 Posts: 1,271 ✭✭✭


    In the 2007 company account there is the following note "A cheque for 670 issued to a supplier had been entered in the books as 760".

    Would I be correct in saying you debit creditors 670 and credit creditirs 760? Please help:confused:.


Comments

  • #2
    Ashashi
    Registered Users, Registered Users 2 Posts: 285 ✭✭Ashashi


    Yes, you increase creditors by 90, if I am correct.


  • #3
    **Timbuk2**
    Moderators, Education Moderators, Motoring & Transport Moderators Posts: 7,396 Mod ✭✭✭✭**Timbuk2**


    Think of it in English - according to the books, we have paid the cr's 90 more than we actually have, so we owe the cr's 90 more than we think

    therefore the correction is
    Bank 90 dr
    Cr's 90 cr


  • #4
    kev9100
    Registered Users, Registered Users 2 Posts: 1,271 ✭✭✭kev9100


    **Timbuk2** wrote: »
    Think of it in English - according to the books, we have paid the cr's 90 more than we actually have, so we owe the cr's 90 more than we think

    therefore the correction is
    Bank 90 dr
    Cr's 90 cr

    Cheers. By the way, you do know you can get the correct bank figure without doing that right?


  • #5
    **Timbuk2**
    Moderators, Education Moderators, Motoring & Transport Moderators Posts: 7,396 Mod ✭✭✭✭**Timbuk2**


    kev9100 wrote: »
    Cheers. By the way, you do know you can get the correct bank figure without doing that right?

    Yeah I do but I like to do it both ways to check the figure. It is on the syllabus that they won't give you the Bank's balance. Instead of saying "A bank statement arrived showing an overdraft of 1220" they could just say "A bank statement arrived showing a different closing balance" or something similar.

    I usually do a mini bank recon (I don't make a ledger account or anything, I just list the 4 or so figures down and total) and then I do the Bank's point of view (which 99% of the time is just a cheque not presented) and once they are the same, I'm confident that I have the correct bank figure.


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