Page 218 - F3 -FA Integrated Workbook STUDENT 2018-19

Chapter 16

Accounting entries for the correction of

errors

If there are errors or omissions in the accounting records, they need to be corrected.

The following procedure should be used when the totals of the trial balance do not
agree:

 calculate the difference between the total of debits and total of credits in the trial
balance

 if the total of debits exceeds the total of credits, post the difference to the credit
side of the suspense account

 if the total of credits exceeds the total of debits, post the difference to the debit
side of the suspense account

 identify the error(s) which account for the suspense account difference

 record the correcting entries in the journal

 update the ledger accounts and clear the suspense account.

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