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In question 5.2 (Eva Co), the company is said to have a closing debit balance of $2,720. Originally I assumed this was in the carried down position, but the answer has this figure on the debit side as the balance brought down.
I think question 5.8’s answer also confused me too for that same reason. I calculated the figure correctly (962.50), however got it wrong because I assumed they wanted the carried down figure, so placed it as 962.50 DEBIT, when it should have been CREDIT.
So would it be safe to assume that if it is said an account has a closing debit/credit balance, it is the brought down figure they are referring to? Or in the case of 5.8, should the answer always be the balance brought down?
Thank you.
If you are told what the balance on an account is then it is always the balance brought down (and it is carried down from the opposite side of the t-account).
This is all explained in my free lectures on Chapter 3 of our free lecture notes.
The lectures are a complete free course for Paper FA and cover everything needed to be able to pass the exam well.
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