Skip to content

ACCA Applied Knowledge · Financial Accounting · Statement of financial position

A trial balance has a suspense account debit of $3,000. It is later found that a $1,500 cash receipt from a customer was credited to receivables correctly but omitted from the bank account. What is the effect of correcting this?

Debit bank $1,500 and credit suspense $1,500. The credit to receivables was recorded but the matching debit to bank was missed, so the suspense account was debited. Posting the missing debit to bank clears half of the suspense balance, leaving $1,500 still unexplained.

  1. ADebit bank $1,500; credit suspense $1,500, leaving suspense $1,500 debit unexplainedCorrect
  2. BDebit suspense $1,500; credit bank $1,500
  3. CDebit bank $3,000; credit suspense $3,000
  4. DNo entry is needed because receivables are already correct

Explanation

The omitted receipt requires debit bank $1,500, with the other side credited to suspense because the double entry was one-sided. This reduces the suspense balance from $3,000 debit to $1,500 debit, which remains to be explained by another error.

Did you get it right without looking?

One question tells you little. A timed set on Statement of financial position shows your real accuracy, how long you take and where you lose marks.

Practise Statement of financial positionFree diagnostic mock

More Statement of financial position questions