When Jayesh extracted a trial balance from his books at 31 December 2003 he found that it
Question:
When Jayesh extracted a trial balance from his books at 31 December 2003 he found that it did not balance. He entered the difference in a Suspense account and then prepared a draft Profit and Loss Account which showed a net profit of $2500. Jayesh later found the following errors.
1. The balance of opening stock $8500 had been entered in the trial balance as $5800.
2. The stock at 31 December 2003 had been understated by $2000.
3. Repairs to a machine, $3500, had been posted to Machinery at Cost account as $5300.
4. An invoice in the sum of $800 for the sale of goods to Bane had been posted to Bane's account but had not been entered in the sales journal.
5. A credit balance of $63 in the sales ledger had been extracted as a debit balance. Jayesh does not maintain Control accounts.
Required
(a) Prepare the journal entries to correct the errors. (Narratives are not required.)
(b) Prepare the Suspense account showing the trial balance difference and the correcting entries.
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