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Chapter 8
Example 1
On 31 December 20X1 a trial balance was extracted from the ledgers of
Marcon and the total of the debit side was found to be $77 less than the total
of the credit side. A suspense account was opened to record the difference.
Later, the following errors were discovered:
A cheque for $150 paid to Bond had been correctly entered in the cash
book but not in Bond’s account or the control account.
The purchases account had been under-cast by $20
A cheque received for $93 from Smith had been correctly entered in the
cash book but had not been entered in Smith’s account.
Required:
(a) Record the journal entries required to clear the difference on the
suspense account, including explanatory narrative.
(b) Prepare the suspense account to confirm that the suspense
account difference has been rectified.
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