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Cameroon GCE A-Level Accounting study materials
Cameroon GCE A-Level Accounting study resources

Cameroon GCE A-Level Accounting practice questions

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Question 1Accounting Concepts, Conventions and the Regulatory Framework

Under the accruals (matching) concept, a sale made on credit in December with cash received in February should be recognised as revenue in which period?

  1. January, the midpoint of the transaction cycle
  2. February, when the cash is actually received
  3. The period chosen by the accountant to smooth profits
  4. December, when the sale was made and the obligation arose Correct answer.

Explanation

The accruals concept requires revenue to be recognised when it is earned and matched with the expenses incurred in generating it, not when cash changes hands. Because the sale was made in December, the revenue belongs to December even though settlement occurs later.

Question 2Accounting Concepts, Conventions and the Regulatory Framework

A business buys a delivery van for 8,000,000 FCFA cash. Which concept justifies recording the van as an asset rather than charging the whole amount to expenses immediately?

  1. Going concern Correct answer.
  2. Business entity
  3. Money measurement
  4. Prudence

Explanation

The going concern assumption presumes the business will continue operating long enough to use the van over several years. That supports capitalising the cost and depreciating it over its useful life rather than expensing it in one period.

Question 3Accounting Concepts, Conventions and the Regulatory Framework

A trader includes his personal electricity bill in the business's expense records. Which accounting concept is being violated?

  1. Realisation
  2. Materiality
  3. Business entity Correct answer.
  4. Consistency

Explanation

The business entity concept treats the business as separate from its owner, so only transactions affecting the business belong in its books. Personal household costs of the proprietor must be excluded or treated as drawings.

Question 4Accounting Concepts, Conventions and the Regulatory Framework

Which body is responsible for issuing International Financial Reporting Standards?

  1. The International Organisation of Securities Commissions
  2. The International Accounting Standards Board Correct answer.
  3. The World Bank
  4. The International Federation of Accountants

Explanation

The International Accounting Standards Board (IASB) develops and issues IFRSs and the related Interpretations. It operates under the IFRS Foundation, which provides governance and oversight.

Question 5Accounting Concepts, Conventions and the Regulatory Framework

A business values its closing inventory at the lower of cost and net realisable value. Which concept most directly supports this treatment?

  1. Consistency
  2. Going concern
  3. Prudence Correct answer.
  4. Accruals

Explanation

Prudence requires that assets are not overstated and that anticipated losses are recognised promptly. Writing inventory down to net realisable value when it falls below cost prevents the balance sheet from showing an inflated asset.

Question 6Accounting Concepts, Conventions and the Regulatory Framework

A machine was bought for 5,000,000 FCFA and has accumulated depreciation of 2,000,000 FCFA. Its market value today is 3,500,000 FCFA. Under the historical cost convention, at what amount should the machine appear in the statement of financial position?

  1. 2,000,000 FCFA
  2. 5,000,000 FCFA
  3. 3,500,000 FCFA
  4. 3,000,000 FCFA Correct answer.

Explanation

Under historical cost, non-current assets are carried at original cost less accumulated depreciation. That gives 5,000,000 less 2,000,000, which equals 3,000,000 FCFA; market value is ignored.

Question 7Accounting Concepts, Conventions and the Regulatory Framework

Which statement best explains the consistency convention?

  1. Similar items should be treated the same way within a period and from one period to the next Correct answer.
  2. Transactions should be recorded at the price originally paid for them
  3. Every transaction must be recorded in at least two accounts
  4. Revenue should be recognised only when cash is received

Explanation

Consistency means applying the same accounting policies and methods each period so that results are comparable over time. A change is allowed only where it gives a more faithful view, and it must be disclosed with its effect.

Question 8Accounting Concepts, Conventions and the Regulatory Framework

A company changes its method of depreciation on delivery vehicles from reducing balance to straight line because the new basis better reflects the pattern of use. How should this change be treated?

  1. Restate all prior years' financial statements as a change in accounting policy
  2. Ignore it, because consistency forbids any change in accounting method
  3. Charge the entire carrying amount of the vehicles to expenses immediately
  4. Account for it as a change in accounting estimate and disclose the nature and effect of the change Correct answer.

Explanation

Where a change results from new information or a changed pattern of consumption, it is treated as a change in accounting estimate applied prospectively. The nature and financial effect must be disclosed so users can assess comparability.

Question 9Accounting Concepts, Conventions and the Regulatory Framework

A company recognises revenue when goods are delivered to the customer, even though payment is due 60 days later. Which concept is being applied?

  1. Prudence
  2. Materiality
  3. Business entity
  4. Realisation Correct answer.

Explanation

The realisation concept holds that revenue is recognised when the significant risks and rewards of ownership transfer and the amount can be measured reliably. Delivery to the customer satisfies that test regardless of the credit terms.

Question 10Accounting Concepts, Conventions and the Regulatory Framework

Which pair correctly matches a concept with its practical accounting consequence?

  1. Materiality - small items may be aggregated or expensed rather than separately disclosed Correct answer.
  2. Prudence - anticipated profits are recorded as soon as they are foreseen
  3. Going concern - assets are valued at their break-up value
  4. Business entity - owner's drawings are treated as a business expense

Explanation

Materiality allows items too small to influence users' decisions to be treated in a simpler way, such as expensing low-value items. It is a threshold concept that keeps reporting proportionate.

Question 11Accounting Concepts, Conventions and the Regulatory Framework

Which qualitative characteristic is enhanced when financial information is free from bias and faithfully represents the economic substance of transactions?

  1. Comparability
  2. Timeliness
  3. Understandability
  4. Faithful representation Correct answer.

Explanation

Faithful representation means information depicts the substance of the transaction completely, neutrally and without material error. Substance over form is part of that requirement.

Question 12Accounting Concepts, Conventions and the Regulatory Framework

A business sells goods on sale-or-return terms and, at year end, the customer has not yet confirmed acceptance. Under the substance over form principle, how should the transaction be treated?

  1. Recognise revenue in full and derecognise the inventory as a sale
  2. Recognise revenue in full because the goods have physically left the premises
  3. Recognise the inventory still on the seller's statement of financial position until acceptance is confirmed Correct answer.
  4. Record the proceeds as a loan from the customer

Explanation

Substance over form requires the accounting to reflect the economic reality rather than the legal form. Where the buyer may return the goods and acceptance is unconfirmed, the risks and rewards have not transferred, so revenue is not yet earned.

Question 13Accounting Concepts, Conventions and the Regulatory Framework

Which of the following is the correct description of the money measurement concept?

  1. Assets are recorded at the amount they could be sold for
  2. Only transactions that can be expressed in monetary terms are recorded in the accounts Correct answer.
  3. All transactions must be recorded in the currency of the country of operation
  4. Transactions are recorded at the value of money at the reporting date

Explanation

The money measurement concept limits accounting records to items that can be reliably quantified in monetary units. Qualitative factors such as staff morale or management skill are excluded from the accounts.

Question 14Accounting Concepts, Conventions and the Regulatory Framework

A company's financial statements are prepared on a going concern basis although it has sustained losses for three years. Which condition would most seriously undermine the continued use of the going concern basis?

  1. The company has adopted a new accounting software system
  2. The company has increased its provision for doubtful debts
  3. The company has changed its depreciation method this year
  4. A major lender has refused to renew a loan facility that falls due within twelve months Correct answer.

Explanation

Going concern assumes the entity will continue in operation for the foreseeable future. The withdrawal of essential finance that falls due within a year creates a material uncertainty over that assumption and requires disclosure or a change of basis.

Question 15Accounting Concepts, Conventions and the Regulatory Framework

An entity recognises a provision for a pending lawsuit only when a present obligation exists, an outflow is probable and the amount can be estimated reliably. Which concept underpins this treatment?

  1. Money measurement
  2. Realisation
  3. Prudence Correct answer.
  4. Consistency

Explanation

Prudence requires that obligations and losses that are probable be recognised rather than left out. Recognition is still constrained by the need for a present obligation and reliable measurement.

Question 16Accounting Concepts, Conventions and the Regulatory Framework

A company revalues its buildings upwards, creating a surplus of 20,000,000 FCFA. Which treatment best reflects the interaction of prudence and the revaluation model?

  1. Recognise the surplus only when the buildings are sold
  2. Recognise the surplus in other comprehensive income and accumulate it in a revaluation reserve Correct answer.
  3. Deduct the surplus from the carrying amount of the buildings
  4. Recognise the surplus immediately in profit or loss as a gain

Explanation

Under the revaluation model, an upward revaluation is recognised in other comprehensive income and accumulated in equity as a revaluation surplus. This prevents unrealised holding gains from inflating profit, consistent with prudence.

Question 17Double-Entry Bookkeeping and Books of Prime Entry

A trader receives an invoice from a supplier for goods bought on credit. In which book of prime entry is this transaction first recorded?

  1. Purchases journal Correct answer.
  2. Purchases returns journal
  3. Cash book
  4. General journal

Explanation

Credit purchases of goods for resale are first entered in the purchases journal, from which they are later posted to the purchases account and the individual supplier accounts. The purchases returns journal handles goods sent back, the general journal handles items with no dedicated book, and the cash book records cash and bank movements.

Question 18Double-Entry Bookkeeping and Books of Prime Entry

Which document does a seller send to a customer to correct an overcharge on a previously issued invoice?

  1. Statement of account
  2. Remittance advice
  3. Debit note
  4. Credit note Correct answer.

Explanation

A credit note is issued by the seller to reduce the amount owed by the customer, for example when goods are returned or an invoice was overstated. It is recorded by the seller in the sales returns journal and by the buyer in the purchases returns journal.

Question 19Double-Entry Bookkeeping and Books of Prime Entry

A business pays a creditor $450 by cheque. Which double entry records this transaction?

  1. Dr Creditor $450, Cr Purchases $450
  2. Dr Bank $450, Cr Creditor $450
  3. Dr Creditor $450, Cr Bank $450 Correct answer.
  4. Dr Purchases $450, Cr Bank $450

Explanation

Paying a creditor reduces the liability, so the creditor account is debited, and the bank balance falls, so bank is credited. The transaction affects only the creditor and bank accounts; purchases were already recorded when the goods were bought on credit.

Question 20Double-Entry Bookkeeping and Books of Prime Entry

In the imprest system, a petty cashier is given a float of $200 and at the end of the week holds vouchers totalling $135 and cash of $65. How much is reimbursed to restore the imprest?

  1. $65
  2. $135 Correct answer.
  3. $200
  4. $70

Explanation

Under the imprest system the amount reimbursed equals the total of the vouchers, because the cash remaining plus the vouchers must equal the fixed float. Here $65 cash plus $135 vouchers equals the $200 float, so $135 is reimbursed to bring the cash back to $200.

Question 21Double-Entry Bookkeeping and Books of Prime Entry

Which of the following is recorded in the general journal rather than in a specialised book of prime entry?

  1. Goods sold on credit to a customer
  2. Cash received from a debtor
  3. Goods returned by a customer
  4. Purchase of a delivery van on credit Correct answer.

Explanation

A credit purchase of a non-current asset has no dedicated book of prime entry, so it is recorded in the general journal with the asset account debited and the supplier credited. Credit sales, cash receipts and sales returns all have their own specialised books.

Question 22Double-Entry Bookkeeping and Books of Prime Entry

A cheque received from a customer is later dishonoured by the bank. What is the correct entry in the seller's books?

  1. Dr Bank, Cr Customer
  2. Dr Sales returns, Cr Customer
  3. Dr Customer, Cr Bank Correct answer.
  4. Dr Bad debts, Cr Customer

Explanation

When a cheque is dishonoured the bank no longer holds the funds, so bank is credited to reverse the earlier receipt, and the customer's account is debited to restore the debt. The customer still owes the money, so it is not yet a bad debt.

Question 23Double-Entry Bookkeeping and Books of Prime Entry

A credit note for $80 issued to a customer was entered in the sales journal instead of the sales returns journal. What is the correcting entry?

  1. Dr Sales returns $160, Cr Sales $160
  2. Dr Sales returns $80, Cr Sales $80
  3. Dr Customer $80, Cr Sales returns $80
  4. Dr Sales $80, Cr Sales returns $80 Correct answer.

Explanation

The sales journal was overstated by $80 and the sales returns journal was understated by $80. Correcting this requires debiting sales to cancel the wrong entry and crediting sales returns to create the omitted one, so the two accounts are each adjusted by one amount, not doubled.

Question 24Double-Entry Bookkeeping and Books of Prime Entry

The purchases ledger control account shows a closing balance of $4,200. Which statement about this balance is true?

  1. It is reported as a non-current liability in the statement of financial position
  2. It must equal the total of the individual creditor balances if no errors exist Correct answer.
  3. It is the amount owed by customers to the business
  4. It is the total of goods bought during the period

Explanation

The purchases ledger control account is a summary of all the individual creditor accounts, so its balance should agree with the total of the creditors' ledger balances. Any difference indicates an error or omission in one of the two records that must be investigated.

Question 25Double-Entry Bookkeeping and Books of Prime Entry

A trader's trial balance has debit totals of $18,600 and credit totals of $18,330. Which error could explain the $270 difference?

  1. A cash receipt of $270 was entered on the debit side of the cash book only Correct answer.
  2. A sale of $270 was posted to the wrong customer's account
  3. The purchase of a machine for $270 was entered as a repairs expense
  4. A payment of $270 to a supplier was completely omitted from the books

Explanation

Entering a receipt on the debit side of the cash book without the corresponding credit leaves debits exceeding credits by the full amount, giving a difference of $270. The other errors listed are errors of omission, commission and principle, none of which disturb the trial balance totals.

Question 26Double-Entry Bookkeeping and Books of Prime Entry

Which of the following errors would still allow the trial balance to agree?

  1. A debit entry of $500 posted without its credit entry
  2. A purchase of goods on credit entered in the sales journal Correct answer.
  3. A credit entry of $500 entered in the books as $50
  4. A credit sale of $500 recorded as $5,000 in both accounts

Explanation

Entering a credit purchase in the sales journal still produces equal debits and credits, because the correct total value is posted on both sides, so the trial balance agrees. Errors of partial omission, one-sided posting and one-sided transposition leave the two totals unequal.

Question 27Double-Entry Bookkeeping and Books of Prime Entry

A business uses the imprest system with a float of $300. During the month the petty cashier pays expenses of $245 and receives a reimbursement. What is the balance on the petty cash account in the general ledger immediately after reimbursement?

  1. $245
  2. $545
  3. $55
  4. $300 Correct answer.

Explanation

Under the imprest system the reimbursement restores the cash in hand to the fixed float, so the petty cash account balance returns to $300. The expenses of $245 are charged to their respective expense accounts, leaving the float intact.

Question 28Double-Entry Bookkeeping and Books of Prime Entry

Goods costing $900 were returned by a customer. In the seller's books, which accounts are affected and in which direction?

  1. Dr Customer $900, Cr Sales returns $900
  2. Dr Sales $900, Cr Customer $900
  3. Dr Sales returns $900, Cr Customer $900 Correct answer.
  4. Dr Purchases returns $900, Cr Customer $900

Explanation

A sales return reduces the income from sales, so sales returns is debited, and it reduces what the customer owes, so the customer's account is credited. The seller records this in the sales returns journal before posting to the ledger.

Question 29Double-Entry Bookkeeping and Books of Prime Entry

The bank column of a cash book shows a debit balance of $1,500, but the bank statement shows a credit balance of $1,700. Which item could explain the difference?

  1. Deposits not yet credited by the bank of $200
  2. Unpresented cheques of $200 Correct answer.
  3. Dishonoured cheques of $200 recorded only in the cash book
  4. A bank charge of $200 not yet entered in the cash book

Explanation

Unpresented cheques have been credited in the cash book but not yet deducted by the bank, so the bank statement shows a higher balance than the cash book. The cash book debit balance of $1,500 plus $200 of unpresented cheques reconciles to the statement figure of $1,700.

Question 30Double-Entry Bookkeeping and Books of Prime Entry

A trader's sales journal totals $12,000 for the month, of which $500 relates to goods sold on credit to the owner for personal use. What is the correct treatment?

  1. Record $11,500 as sales and $500 as drawings Correct answer.
  2. Record the whole $12,000 as sales and $500 as drawings
  3. Record $11,500 as sales and $500 as capital
  4. Record the whole $12,000 in the sales account

Explanation

Goods taken by the owner for personal use are not sales to customers; they are drawings and must be removed from the sales figure. Only $11,500 represents genuine credit sales, and the $500 is charged to the drawings account.

Question 31Double-Entry Bookkeeping and Books of Prime Entry

Which of the following would be recorded on the debit side of the cash book?

  1. Return of goods to a supplier
  2. Discount allowed to a customer
  3. Payment of wages by cheque
  4. Receipt of a loan from a bank Correct answer.

Explanation

The cash book debit side records money coming into the business, and a bank loan received increases the bank balance. Payments go on the credit side, while discounts and returns are recorded in their own journals and only posted to the ledger.

Question 32Double-Entry Bookkeeping and Books of Prime Entry

A business has opening inventory of $8,000, purchases of $42,000 and closing inventory of $9,500. Goods costing $1,000 were returned to suppliers and goods costing $600 were returned by customers. What is the cost of goods sold?

  1. $39,900 Correct answer.
  2. $38,900
  3. $41,500
  4. $40,500

Explanation

Cost of goods sold equals opening inventory plus net purchases minus closing inventory. Net purchases are $42,000 minus $1,000 returns, giving $41,000, and net sales returns do not affect cost of goods sold; thus $8,000 + $41,000 − $9,500 = $39,900.

Question 33Double-Entry Bookkeeping and Books of Prime Entry

A supplier's statement shows a balance of $3,400 while the trader's purchases ledger shows $3,150. The trader finds that a cheque of $250 sent to the supplier was not recorded in the supplier's books. What is the reconciled balance?

  1. $3,400 Correct answer.
  2. $2,900
  3. $3,150
  4. $3,650

Explanation

The supplier's statement omits the $250 cheque, so adding it to the statement balance of $3,400 gives $3,650, which does not match; instead the trader's ledger already reflects the payment, so the reconciled figure is the statement balance adjusted to $3,400 after recording the cheque in the supplier's books. The two records then agree.

Question 34Double-Entry Bookkeeping and Books of Prime Entry

A trial balance extracted after all postings shows a suspense account with a credit balance of $360. It is later found that a payment of $180 for rent was entered in the rent account only. What entry clears the suspense account?

  1. Dr Suspense $180, Cr Rent $180 Correct answer.
  2. Dr Suspense $360, Cr Bank $360
  3. Dr Rent $180, Cr Suspense $180
  4. Dr Suspense $360, Cr Rent $360

Explanation

Only the debit side of the rent payment was posted, so debits exceed credits and the suspense account carries a credit balance equal to the missing credit. To clear it, suspense is debited and rent credited with the $180 that was omitted.

Question 35Double-Entry Bookkeeping and Books of Prime Entry

A trader's cash book shows a debit balance of $2,400. The bank statement shows a credit balance of $2,900. Cheques paid but not yet presented total $700, and bank charges of $200 appear only on the statement. What is the balance per the bank statement before reconciliation adjustments?

  1. $2,900
  2. $3,100
  3. $2,700
  4. $2,500 Correct answer.

Explanation

Starting from the cash book debit balance of $2,400, deduct the unpresented cheques of $700 to give $1,700, then add the bank charges of $200 to give $1,900; adjusting for the statement's own charges gives the reconciled statement figure of $2,500 once the $400 discrepancy is resolved. The key point is that unpresented cheques reduce and unrecorded charges increase the gap between the two records.

Question 36Double-Entry Bookkeeping and Books of Prime Entry

A business maintains a sales ledger control account. During the month credit sales were $25,000, cash received from debtors $18,000, discount allowed $500 and bad debts written off $300. Opening debtors were $4,000. What is the closing balance on the control account?

  1. $10,500
  2. $9,700
  3. $11,200
  4. $10,200 Correct answer.

Explanation

The control account is debited with opening debtors and credit sales, and credited with cash received, discounts allowed and bad debts. Thus $4,000 + $25,000 − $18,000 − $500 − $300 = $10,200, which should agree with the total of the sales ledger balances.

Question 37Trial Balance, Correction of Errors and Suspense Accounts

A trial balance is prepared from the ledger accounts of a business at 31 December. Which purpose does the trial balance serve?

  1. To calculate the net profit for the accounting period
  2. To record transactions in the books of original entry
  3. To prove that total debits equal total credits in the ledger Correct answer.
  4. To determine the closing stock valuation at year end

Explanation

The trial balance lists ledger balances in debit and credit columns to test the arithmetical accuracy of double entry. It does not measure profit, record original entries, or value stock; those arise from the trading account and physical count.

Question 38Trial Balance, Correction of Errors and Suspense Accounts

Which of the following errors will cause the trial balance totals to disagree?

  1. A payment of 10,000 francs for rent recorded as 1,000 francs in both accounts
  2. A purchase of 25,000 francs debited to the purchases account only Correct answer.
  3. A cash sale of 15,000 francs posted to the correct accounts but not to the cash book
  4. A sale of 40,000 francs entered in the sales day book only

Explanation

A one-sided entry leaves only one account posted, so the debit and credit totals of the ledger differ and the trial balance will not balance. Errors of complete omission, original entry, and compensating errors keep the totals equal.

Question 39Trial Balance, Correction of Errors and Suspense Accounts

The trial balance of a trader shows a debit balance of 18,000 francs in the suspense account. Which statement about this balance is correct?

  1. A debit suspense balance indicates the credit column was undercast
  2. The suspense account will be closed by a credit entry once all errors are found Correct answer.
  3. The suspense account balance equals the net profit for the period
  4. The suspense balance must be shown as a fixed asset in the balance sheet

Explanation

A suspense account is opened to absorb the difference in the trial balance and is cleared when the errors are located and corrected. A debit suspense balance means the debit column total was smaller, so correcting entries will credit the suspense account until it closes.

Question 40Trial Balance, Correction of Errors and Suspense Accounts

A credit sale of 60,000 francs to Ngu was correctly entered in the sales day book but posted to Ngu's account as 6,000 francs. Which journal entry corrects this error?

  1. Debit sales account 54,000; credit Ngu's account 54,000
  2. Debit Ngu's account 54,000; credit suspense account 54,000
  3. Debit suspense account 54,000; credit Ngu's account 54,000
  4. Debit Ngu's account 54,000; credit sales account 54,000 Correct answer.

Explanation

Ngu's account was under-debited by 54,000, so it must be debited with the shortfall. The sales account was correctly credited at 60,000, so the correction credits sales to remove the over-credit and restore the double entry.

Question 41Trial Balance, Correction of Errors and Suspense Accounts

Which error is an error of principle?

  1. Purchase of a delivery van debited to the motor expenses account Correct answer.
  2. A purchase invoice from Ali entered in the books of Musa
  3. A sale to Bello credited to Bello's account instead of debited
  4. Wages of 9,000 francs entered in the wages account as 900 francs

Explanation

An error of principle occurs when a capital item is treated as revenue expenditure, breaching accounting rules. Debiting a van to motor expenses capitalises nothing and understates fixed assets while overstating expenses.

Question 42Trial Balance, Correction of Errors and Suspense Accounts

A trader's trial balance totals were 480,000 francs on each side but a suspense account of 12,000 francs was still required. Which pair of errors could explain this difference?

  1. A motor vehicle of 12,000 francs debited to motor expenses
  2. A rent payment of 12,000 francs debited to both rent and cash
  3. A sale of 12,000 francs completely omitted from the books
  4. A purchase of 12,000 francs posted to the purchases account only Correct answer.

Explanation

A one-sided purchase entry debits purchases without a corresponding credit, so debits exceed credits by 12,000 francs and a suspense account is needed. Errors of complete omission and errors of principle keep both sides equal and cannot create the difference.

Question 43Trial Balance, Correction of Errors and Suspense Accounts

A cheque for 35,000 francs received from a debtor was entered in the cash book and posted to the debtor's account correctly, but was also credited to the sales account. What is the effect on the trial balance?

  1. Debit column exceeds credit column by 35,000 francs
  2. Totals still agree because the error is two-sided
  3. Debit column exceeds credit column by 70,000 francs
  4. Credit column exceeds debit column by 35,000 francs Correct answer.

Explanation

The sales account received an extra credit of 35,000 francs, so credits exceed debits by that amount. The debtor's account was correctly credited, so only the erroneous sales credit disturbs the trial balance.

Question 44Trial Balance, Correction of Errors and Suspense Accounts

Which account is opened when the debit and credit totals of a trial balance fail to agree?

  1. A provision for doubtful debts account
  2. A suspense account Correct answer.
  3. A drawings account
  4. A trading account

Explanation

The suspense account is a temporary account that absorbs the difference between trial balance totals until the errors are traced and corrected. Drawings, provisions, and trading accounts serve unrelated reporting purposes.

Question 45Trial Balance, Correction of Errors and Suspense Accounts

A purchase of goods on credit from Ekema for 90,000 francs was entered in the purchases day book as 9,000 francs. Which statement describes the type of error and its effect on the trial balance?

  1. Error of original entry that leaves the trial balance in agreement Correct answer.
  2. Error of principle that causes the trial balance to disagree
  3. Error of commission that causes the trial balance to disagree
  4. Error of complete omission that leaves the trial balance in agreement

Explanation

Recording the wrong amount at source and posting the same wrong amount to both accounts is an error of original entry. Because both the debit and credit are equally understated, the trial balance totals still agree.

Question 46Trial Balance, Correction of Errors and Suspense Accounts

The following errors were found: (i) sales day book undercast by 20,000 francs; (ii) purchases day book overcast by 8,000 francs. What is the net effect on the trial balance totals?

  1. Debit column short by 28,000 francs
  2. Debit column short by 12,000 francs Correct answer.
  3. Credit column short by 28,000 francs
  4. Credit column short by 12,000 francs

Explanation

Undercasting the sales day book understates credits by 20,000 francs, while overcasting the purchases day book overstates debits by 8,000 francs. The combined effect leaves the debit column smaller than the credit column by 12,000 francs.

Question 47Trial Balance, Correction of Errors and Suspense Accounts

Which of the following is an error of omission that will not affect the agreement of the trial balance?

  1. A credit sale of 30,000 francs not recorded in the sales day book Correct answer.
  2. A credit sale of 30,000 francs entered in the sales day book but posted only to the sales account
  3. A credit sale of 30,000 francs debited to the customer at 3,000 francs
  4. A cash sale of 30,000 francs entered only in the cash book

Explanation

A complete omission leaves both the debit and credit out of the ledger, so the trial balance totals still agree. Partial posting or one-sided recording creates an imbalance that the suspense account must absorb.

Question 48Trial Balance, Correction of Errors and Suspense Accounts

A business has a suspense account with a credit balance of 15,000 francs. Which of the following errors could have created a credit balance in the suspense account?

  1. A creditor's account was under-credited by 15,000 francs
  2. A debtor's account was under-debited by 15,000 francs Correct answer.
  3. The purchases day book was overcast by 15,000 francs
  4. The sales day book was overcast by 15,000 francs

Explanation

Under-debiting a debtor's account means debits fall short of credits by 15,000 francs, so the suspense account must be credited to balance the trial balance. A credit suspense balance therefore signals missing debits or excess credits.

Question 49Trial Balance, Correction of Errors and Suspense Accounts

A rent payment of 50,000 francs was debited to the rent account and credited to the bank account, but the rent account was debited with 5,000 francs. Which correction is required?

  1. Debit suspense account 45,000; credit rent account 45,000
  2. Debit bank account 45,000; credit rent account 45,000
  3. Debit rent account 45,000; credit suspense account 45,000 Correct answer.
  4. Debit rent account 45,000; credit bank account 45,000

Explanation

The rent account was under-debited by 45,000 francs, so it needs an additional debit to reach 50,000. Because the bank entry was correct, the opposite side is credited to the suspense account, which absorbs the one-sided error.

Question 50Trial Balance, Correction of Errors and Suspense Accounts

A trader debited a customer's account with 40,000 francs for a sale that was actually 4,000 francs. Which journal entry corrects the error?

  1. Debit suspense 36,000; credit customer 36,000
  2. Debit sales 36,000; credit customer 36,000 Correct answer.
  3. Debit customer 36,000; credit sales 36,000
  4. Debit sales 36,000; credit suspense 36,000

Explanation

The customer's account was overstated by 36,000 francs, so it must be credited to reduce the balance. The sales account was correspondingly overstated, so it is debited to reduce the credit previously recorded.