Identify errors in entries
1
1. Goods sold on credit to H Lin for $6,780 were recorded in H Lui's account.
2
A machine purchased on credit from L. Po for $43,900 was omitted from the books.
3
A van purchased for $38,000 was entered in the motor expenses account.
4
Goods sold on credit to C Fung for $2,210 were recorded in the sales journal as $2,120.
5
Both the purchases account and the sales account were overstated by $100.
6
A cash payment of $8,000 to H Kwong was entered on the debit side of the cash book and the credit side of H Kwong's account.
7
A credit purchase of $6,990 from K Wong was recorded in H Wong's account.
8
A cheque of $1,890 for advertisement payment was entered in the cash column of the cash book.
9
Repairs to the owner's car costing $1,200 were recorded in the motor vehicles account.
10
Cash of $1,200 withdrawn from the bank for business use was debited to the bank account and credited to the cash account.
11
A credit purchase of $8,900 from K Li was recorded in the purchases journal as $9,900.
12
Cash of $10,000 deposited into the business bank account by the owner was not recorded in the books.
13
A debit note of $1,060 sent to D Mok, a trade creditor, was recorded in the returns outwards journal as $1,600.
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14
Both the returns inwards account and the returns outwards account were understated by $800.
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15
A machine acquired at $20,000 with a zero net book value was sold for $2,000 cash. This was recorded as a cash sale of $2,000.
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16
Interest of $6,000 received on a time deposit was debited to the bank charges account and credited to the bank account.
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Feedback
Error of commission (incorrect account of the same type)
Dr H Lin 6,780;
Cr H Lui 6,780
Error of omission (no entry has been made)
Dr Machinery 43,900;
Cr L. Po 43,900
Error of principle (wrong type of account)
Dr Motor Vehicles 38,000;
Cr Motor Expenses 38,000
Error of original entry (incorrect amount)
Difference = $90
Dr C Fung 90;
Cr Sales 90
Compensating errors (two errors cancel each other out)
Dr Sales 100;
Cr Purchases 100
Error of complete reversal of entries (wrong sides)
Dr H Kwong 16,000 ( 8000 x2);
Cr Cash 16,000
Error of commission (incorrect account of the same type)
Dr H Wong 6,990;
Cr K Wong 6,990
Error of omission (credit entry in cash omitted),
Dr Suspense Account 1,890;
Cr Cash 1,890
Error of principle (wrong type of account)
Dr Repairs Expense 1,200;
Cr Motor Vehicles 1,200
Error of complete reversal of entries (wrong sides)
Dr Cash 2,400;
Cr Bank 2,400
Error of original entry (incorrect amount)
Overstated by $1,000
Dr K Li 1,000;
Cr Purchases 1,000
Error of omission (no entry has been made)
Dr Bank 10,000;
Cr Capital 10,000
Error of original entry (incorrect amount)
Difference = $540
Dr D Mok 540;
Cr Returns Outwards 540
Compensating errors (two errors cancel each other out)
Dr Returns Inwards 800;
Cr Returns Outwards 800
Error of principle (wrong type of account.)
Dr Sales 2,000
Dr Accumulated Depreciation 20,000;
Cr Machinery 20,000
Cr Gain on Disposal 2,000
Error of complete reversal of entries (wrong sides)
Dr Bank 12,000;
Cr Bank Charges 6,000
Cr Interest Income 6,000
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