Accounting for IGCSE & O level - Accounting Procedures (Section 17 - No. 17)
Identify the corrections required in the journal before correcting an error where the purchase journal was understated by £200.
Debit £200 from purchases account and credit suspense account.
Debit £200 from capital and credit suspense account.
Debit £200 from purchases account and credit capital account.
Credit £200 from purchases account and debit suspense account.
Explanation
If the purchase journal was understated, that means the expenses were less, so an adjustment must be made to purchases account and a suspense account.
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