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JAMB Principles of Accounts 2014 Question 4

Question 4

Correction of Errors and Suspense Account

A cheque of ₦5,000 paid to Suleiman had been correctly entered in the cash book but had not been entered in Suleiman's account. To correct this error, debit Suleiman's account and credit

  1. A.cash account.
  2. B.bank account.
  3. C.suspense account.
  4. D.purchases account.
Show the answer and explanation

Answer: C (suspense account.)

Explanation

The bank side was already recorded, so the trial balance difference sits in suspense. Posting the missing debit to Suleiman clears the suspense account (credit suspense).