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Inquiries undertaken after the failure of the trial balance to balance revealed that the difference was wholly due to carrying down the Cash account balance of £74,800 as £47,800. No suspense account was set up. To correct this error which of the following courses of action is necessary:
A. Journal entry : Debit Suspense account and credit Cash account with £27,000
B. Journal entry : Debit Cash account and credit Suspense account with £27,000
C. Journal entry: Debit Cash account and credit Sales account with £27,000
D. No journal entry : Debit the Cash account with £27,000the answer given to this problem is D. how?????
Hi mansoor because if we need 27000 to correct our entry to 74800.As we entered 47800 instead ov of 74800 so there is difference ov 27000 (74800-47800) its mean if we debit 27000 to cash so all things will be good for us hope it will make sense to you and if not u can ask
There was no suspense account. It was a simple balancing error and the cash was ‘missing’.
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