CIMA BA3 · Chapter 7 · Question 5 of 10
A suspense account was opened when a trial balance did not agree. The following errors were then found, and these explain the whole difference: (1) an electricity payment of $680 was correctly credited in the cash book but debited to the electricity account as $860; (2) credit sales of $3,250 were credited to sales but not posted to the receivables control account; (3) discount received of $420 was debited to the payables control account but not posted to the discount received account. What was the original balance on the suspense account?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) $2,650 debit
Explanation
Error 1: debits are overstated by $180, so the suspense account needs a credit of $180. Error 2: a debit of $3,250 is missing, so the suspense account needs a debit of $3,250. Error 3: a credit of $420 is missing, so the suspense account needs a credit of $420. Net suspense balance = $3,250 - $180 - $420 = $2,650 debit.
More Errors, the trial balance and suspense accounts MCQs
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