At the end of his financial year on 31 July 204, Silas opened a suspense account with

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At the end of his financial year on 31 July 20–4, Silas opened a suspense account with a credit balance of $70.

a. Suggest one reason why this account was required.

After preparing draft financial statements Silas discovered the following errors:

1. The purchases returns journal was overcast by $100.
2. Carriage inwards, $195, had been debited to the carriage outwards account.
3. The total of the analysis column for travelling expenses in the petty cash book, $42, had not been transferred to the ledger.
4. $420 paid to Amina, a credit supplier, had been debited to the account of Amira, another credit supplier.
5. The balance of the petty cash book, $150, had not been entered in the trial balance.
6. The total of the discount received column in the cash book, $181, has been debited to the discount allowed account in the ledger.

b. Prepare the suspense account. Balance or total the account as necessary.
c. Prepare journal entries to correct the errors. Narratives are not required.

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