Acca financial Accounting (FA) Study Text ac ca (FA)

What journals are required to correct the errors and eliminate the 

suspense account? 

 

 

 

Solution to Illustration 1 

 

Process of clearing a suspense account 

The starting position we have is as follows (when we have posted our 

$957 difference identified): 

Suspense account 

 $ 

 $ 

Balance b/f 

1,075  Trial balance difference 

957 

 

 

 

 

 

 

 

 

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Chapter 16 

KAPLAN PUBLISHING

 

277 

 

We now need to work our way through the information given in numbered 

points 1 to 8 to try and clear this suspense account. 

You need to ask yourself the following questions for each point: 

(a)  what should the double entry have been? 

(b)  what was the double entry that has been made? 

(c)  what is the journal we need to correct this? 

1 

(a)  It should have been: Dr postage $75, Cr bank $75 

(b)  The posting made was: Dr postage $750, Cr bank $75, so the 

other Dr of $675 will automatically go to the suspense a/c 

 

(c)  correction = Dr suspense a/c $675, Cr postage $675 

2 

(a)  It should have been: Dr payables $500, Cr cash $500 

(b)  The posting was: Dr suspense a/c $500, Cr cash $500 

(c)  Correction = Dr payables $500, Cr suspense a/c $500 

3 

(a)  It should have been Dr Motor vehicles cost $1575, Cr bank 

 $1575 

(b)  The posing was: Dr suspense a/c $1575, Cr cash $1575 

(c)  Correction = Dr motor vehicles $1575, Cr suspense a/c $1575 

4 

(a)  should have been: Dr bank/cash $81. Cr sundry income $81 

(b)  The posting was: Dr sundry income $81, Dr bank $81 Cr 

suspense a/c $162 

(c)  Correction = Dr suspense a/c $162, Cr sundry income $162 

5 

(a)  Should have been Dr cash $5, Cr receivables $5 

(b)  The posting was: Dr cash $625, Cr receivables $5, so Cr 

suspense a/c $620 

(c)  Correction = Dr suspense a/c $620, Cr cash $620 

6 

(a)  Should have been: Dr bank $500, Cr capital $500 

(b)  The posting was: Dr bank $500, Cr suspense a/c $500 

(c)  Correction = Dr suspense a/c $500, Cr capital $500 

7 

(a)  Should have been: Dr bank $120, Cr receivables $120 

(b)  The posting was: omitted  completely 

(c)  Correction = Dr bank $120, Cr receivables $120 

8 

(a)  Should have been Dr cash $50, Cr receivables $50 

(b)  The posting was: Dr cash $5, Cr receivables $5 

(c)  Correction = Dr cash $45, Cr receivables $45 

 

 

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