Ken's records resulted to a net profit of sh. 130,000 and a suspense balance of sh....

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Ken's records resulted to a net profit of sh. 130,000 and a suspense balance of sh. 20,000 (debit) on 30th September, 2021. Investigations revealed the following: Sales day book was overstated by sh. 40,000 1. 2. of Purchases returns were understated by sh. 2.000 3. 4. 5. Rent paid sh. 24,000 had been recorded in the account as sh. 42.000 Closing inventory of sh. 60,000 were not included in the trading account Discount allowed sh. 5,000 was debited to discount received account Required (ii) Suspense account fully balanced Compute the correct net profit (3 Marks) (3 Marks) Ken's records resulted to a net profit of sh. 130,000 and a suspense balance of sh. 20,000 (debit) on 30th September, 2021. Investigations revealed the following: Sales day book was overstated by sh. 40,000 1. 2. of Purchases returns were understated by sh. 2.000 3. 4. 5. Rent paid sh. 24,000 had been recorded in the account as sh. 42.000 Closing inventory of sh. 60,000 were not included in the trading account Discount allowed sh. 5,000 was debited to discount received account Required (ii) Suspense account fully balanced Compute the correct net profit (3 Marks) (3 Marks)

Answer rating: 100% (QA)

To fully balance the Suspense Account and compute the correct net profit we need to make adjustments ... View the full answer