Correction of errors

This topic has 1 reply, 2 voices, and was last updated 10 years ago by John Moffat.

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May 4, 2016 at 1:25 pm #313680
abrizni10
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A non current asset with a carrying value of $ 7890 was disposed of for $9000. The only accounting entry was to debit cash

I credited suspence account and debited cash account 9000

But I’m wrong again 🙁 The book had debited suspence account and credited disposal?
May 4, 2016 at 5:38 pm #313701
John Moffat
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The book is correct.

When they dispose of an asset they should debit cash and credit disposal account.

They did debit cash, so that is OK, but they did not credit anywhere.

So to make it correct they need to credit the disposal account and debit the suspense account.
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