Fahim Muhammad Nael ACCA

1. Which one of the following would be an error of principle?

A. Plant and machinery purchased was credited to a non-current assets account.

B. Plant and machinery purchased was debited to the purchases account.
C. Plant and machinery purchased was debited to the equipment account.
D. Plant and machinery purchased was credited to the equipment account.

2. Where a transaction is entered into the correct ledger accounts, but the wrong amount is used, what is the error known
as?

A. An error of omission
B. An error of original entry
C. An error of commission
D. An error of principle

3. Net profit was calculated as being $ 10,200. It was later discovered that capital expenditure of $ 3,000 had been treated
as revenue expenditure, and revenue receipts of $ 1,400 had been treated as capital receipts.
What is the net profit after correcting this error?

A. $ 5,800
B. $ 8,600
C. $ 11,800
D. $ 14,600

4. A suspense account was opened when a trial balance failed to agree. The following errors were later discovered.

• A gas bill of $ 420 had been recorded in the gas account as $ 240.
• A discount of $ 50 given to a customer had been credited to discounts received.
• Interest received of $ 70 had been entered in the bank account only.

What was the original balance on the suspense account?

A. Debit $ 210
B. Credit $ 210
C. Debit $ 160
D. Credit $ 160

5. A company’s trial balance failed to agree, the out of balance difference of $ 25,000 being posted to a suspense account.
Subsequent investigation revealed the difference was due to one side of an entry to record the purchase of machinery
for $ 25,000 by cheque, failing to post to the plant and machinery account.

Debit $ Credit $
A Plant and machinery 25,000
Bank current account 25,000
B Suspense account 25,000
Plant and machinery 25,000
C Plant and machinery 25,000
Suspense account 25,000
D Bank current account 25,000
Suspense account 25,000
 Fahim Muhammad Nael ACCA

6. The suspense account shows a debit balance of $ 100. What could this balance be due to?
A. Entering $ 50 received from A turner on the debit side of a Turner’s account
B. Entering $ 50 received from A turner on the credit side of a Turner’s account
C. Undercasting the sales day book by $ 100
D. Undercasting the purchases account by $ 100

7. A suspense account shows a credit balance of $ 130. Which of the following could be due to?
A. Omitting a sale of $ 130 from the sales ledger
B. Recording a purchase of $ 130 twice in the purchase account
C. Failing to write off a bad debt of $ 130
D. Recording an electricity bill paid of $ 65 by debiting the bank account and crediting the electricity account.