Question

Section B - 5(a) The following is the trial balance of Abete Trading Company as at 31st December 2020 (Depreciation of fixed assets Cr Le9,260; Stock 1 Jan 2020 Dr Le3,600; Purchases/Sales Dr Le100,000/Cr Le174,000; General expenses Dr Le170,000 [likely Le17,000]; Fixed assets Dr Le42,600; Returns Cr Le4,800/Dr Le2,400; Discounts Cr Le2,000/Dr Le400; Salaries and wages Dr Le21,000; Suspense account Dr Le3,060; totals Le190,060 both sides). Additional info: closing stock Le4,000; errors requiring the suspense account - Drawings of Le1,000 posted to Salaries and Wages account; Furniture bought at Le1,560 wrongly debited to fixed asset as Le300; Purchases day book undercast by Le2,000; Discount allowed of Le200 to a customer not posted to the customer's account. Depreciation of fixed assets is 10% per annum. Required: (a) correct the errors through journal entries (no narration required).

Model answer

JOURNAL ENTRIES (correcting the errors, no narration) 1. Dr Drawings Account Le1,000; Cr Salaries and Wages Account Le1,000. 2. Dr Furniture Account Le1,260; Cr Suspense Account Le1,260. (Correcting the difference between Le1,560 actually spent and Le300 wrongly debited.) 3. Dr Purchases Account Le2,000; Cr Suspense Account Le2,000. (Correcting the undercast in the purchases day book.) 4. Dr Suspense Account Le200; Cr Debtors Account Le200. (Posting the omitted discount allowed to the customer's account.)

Accepted Answer

JOURNAL ENTRIES (correcting the errors, no narration)

1. Dr Drawings Account Le1,000; Cr Salaries and Wages Account Le1,000.
2. Dr Furniture Account Le1,260; Cr Suspense Account Le1,260. (Correcting the difference between Le1,560 actually spent and Le300 wrongly debited.)
3. Dr Purchases Account Le2,000; Cr Suspense Account Le2,000. (Correcting the undercast in the purchases day book.)
4. Dr Suspense Account Le200; Cr Debtors Account Le200. (Posting the omitted discount allowed to the customer's account.)

WAEC Accounting 2023 Theory — Question 13

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