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WAEC Financial Accounting 1999 Question 32

Question 32

Correction of Errors and Suspense Account

A Suspense Account is used to

  1. A.record differences in the books until errors are located
  2. B.accumulate debit and credit balances
  3. C.accommodate debit balances of profit statements
  4. D.record accounts of the general ledger.
Show the answer and explanation

Answer: A (record differences in the books until errors are located)

Explanation

The suspense account holds the trial balance difference until the errors are found and corrected.