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ACCA Applied Knowledge · Financial Accounting · Correction of errors

A payment of $900 for rent was correctly credited to the bank account but was not recorded anywhere else. A suspense account was opened to balance the trial balance. Which journal corrects the error?

Debit rent expense $900 and credit suspense $900. The debit side of the rent payment was omitted, so suspense was debited to balance the trial balance. Posting the missing debit to rent and crediting suspense clears the suspense balance and completes the original double entry.

  1. ADr Rent expense $900, Cr Suspense $900Correct
  2. BDr Suspense $900, Cr Rent expense $900
  3. CDr Rent expense $900, Cr Bank $900
  4. DDr Bank $900, Cr Suspense $900

Explanation

The credit to bank was posted but the debit to rent was omitted, so the trial balance had debits short by $900. The suspense account therefore had a $900 debit. Debiting rent and crediting suspense clears it. Option C would duplicate the bank credit.

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