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Anyone preparing the exam for June 2014?
I am looking for a student partner.
ThanksHi Natie, I am happy to know that I am not alone 🙂
My email is micheleav@libero.it so we can study together. Are you going to buy the book or just using the note here?i completed my fa1 2 months ago and got a 94. let me know of any help u need.. i will be more than happy to help.
Hi Mansoor,
thank you for the help. Did you study only using the notes on the web site or did you buy the books?
i used the bpp book plus i used the internet and the forums here… specially john moffat.
the most difficult was bank recon exercises and determining the types of accounting errors.
Hi all,
I’m also starting FA1 , mansoor if you have study text and can send to me please send me.
Thanks & Rgds,
TRK*hey y’all
i need your help on knowing the basics of fa1 am having exams on monday 24what basics?
u shd know ur bank reconcilitaions, types of errors in tb, correcting erros in tb, sales tax calculations.
if u have specific questions…then write them in
Hi All,
The accounting errors eg. commission, principle and transposition are giving me some trouble understand myself.
Hi Malissa:
Account Categories: Assets, Liabilities, Expenses, Income, Capital
Error of commission is when an entry is made in wrong account but the category is correct. eg
purchase entry on credit:
Dr. Purchases
Cr. Payablesif this entry is done as
Dr. Motor Vehicle …correct category but wrong account
Cr. PayablesNote that both accounts being debited are Asset accounts.
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Error of Principle is wrong account AND wrong category.
taking the same example as above, if the entry is done as follows:
Dr. Purchases
Cr. Incomethen this entry is an error of principle. the correct entry category of Payables is a Liability account, but instead the Income is credited.
errors of principle reflect a lack of understsanding of the transaction and where the entries shd be made.
errors of commission can also be termed as careless mistakes by the bookkeeper who KNEW that an Asset account needs to be debited but did not give much thought to WHICH account.
—————————————————————————–
errors of transposition:
in modern terms, these are “typos” … this is what helps me to understand these types of errors.
if i was typing a figure of 1324 and accidentally typed in 1234, maybe because my mind was somewhere else (eg. wanting to leave early from the office) or maybe my mind was numbed to the numbers since i had entered 40 vouchers already and my eyes and brain simply stopped functioning for that split second.
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a transposition error will usually occur in one transaction of the double entry which will cause the TB not to balance.errors of commission and principle do not cause any imbalances in the TB.
———————one entry can also have more than one errors:
if we take the error of principle above if i made the following entry:
Dr. Purchases 1324
Cr. Income 1234then is entry is not only an error of principle but also a transposition errors.
hope this helps
hey mansoor!
kindly assist me with sales tax am lost on this topic pliz
my exams are 2moro @ 8.30amhi i am new this website. I want help on how to register for FA1 exams and how to get the study material, lectures etc……
Suspense Accounts are special in that u dont need a double entry to create them.
for example, if the trial balance did not balance, you are able to create a single dr or a credit entry to balance the TB.
Also, lets say u were entering a transaction, eg. u bought a car by paying cash. if u were unsure which account to debit, u can debit the suspense ac and when u r clear which ac is to be debited, u can then pass an adjusting entry. Like
you bought a car for 2000. now u r unsure which ac to debit, so u wd do he following:
Dr Suspense
Cr CashNow, couple of days later, you find out that the Correct ac was Motor Vehicles. so, you wd do the following:
Dr Motor Vehicles
Cr Suspensethis wd clear the suspense ac and book the transaction in the correct account.
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Suspense is also used in correcting the imbalance of TB. for example, in a TB if total Dr=100000 and Credits equal 90000, what does this mean?
this means u r missing 10000 on the credit side. so, you wd CREATE a SINGLE entry as follows:
Cr suspense 10000
this wd balance ur TB for the time being.
then u wd look for errors in the books, which is pretty tricky.Lets say u were lucky and you found out that u missed booking a cash sale.
the sale was for 10000 cash, and the entry SHOULD have been:
Dr Cash 10000
Cr Sale 10000But the bookkeeper was careless and never entered the Cr side.
As u can see, this error will give 10000 more debit than credit.
Now, you already created a suspense ac with 10000 Cr. What needs to be done to credit sales by 10000?
you wd do the following:
Dr Suspense 10000 —-this wd zero out the suspense ac
Cr Sales 10000 —– this wd add the needed credit to the sale ac.thus, with this entry, you have cleared the suspense and credited the sales ac by 10000 and voila.. u have balanced you TB.
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the above example was a simple one. in that, it had only one error and did not require kuch work.
in reality, you may have several errors. If we use the above example of a difference of 10000 on the credit side, it is quite possible to have errors in any number of entries that have added up to 10000 cr.
lets say u foind out u had made 2 errors.
first error: there was a purchase return of 5000. the entry shd have been:
Cr Purchase 5000
Dr. Payable control Account 5000second error:
there was a crdit note of 5000 given to a customer.
the entry shd have beenCr. Receivable Control Ac 5000
Dr. Sales 5000In both error, the book keeper forgot to enter the credit part of the entries.
So, how wd we go about correcting these mistakes?
I have already written what the entries SHOULD have been.
So now, to correct them we will do the following:
first error correction:
Dr. Suspense 5000
Cr. Purchase 5000second error correction:
Dr. Suspense 5000
Cr. Receivable control ac 5000These 2 entries wd zero out the suspense and put the required credit entries where they r needed.
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but the story does not end here.
Just because there is a suspense of 10000 cr, does not mean that ALL CORRECTING ENTRIES WD INVOLVE DEBITED THE SUSPENSE ACCOUNT.
it cd very well be that u may need several debits and credits in the suspense to clear out the 10000 cr balance.
if u have understood thus far, let me know and i will give an ugly example of several debits/credits
hi, i need help plz i started FA1 last week and am asking 4 advice on what i should do in order to pass it.
study the text at least 3 times, sentence by sentence and 5 days beofre exam start with kit question
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