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A trial balance inlcudes a suspense account. Opening stock of £31763 had been entered on the credit side of the trial balance as £31673. The trial balance itself had been undercast on the debit side by £90.
What net entry will be made in the suspense account to correct these errors ?A. £63436 DR
B. £63436 CR
C. £63526 DR
D. £63526 CROpening stock should have been 31,763 Dr, was 31,673 Cr. Error = 31,763 + 31,673 = 63,436 too much credit.
Undercast of 90 on Dr side means another extra Cr imbalance of 90
Therefore Cr side of TB too much by 90 + 63,436 = 63,526.
The required suspense account balance will be 63,526 Dr to even things up.
However, the question is badly worded “What net entry will be made in the suspense account to correct these errors ?”. Making a Dr entry of $63,526 in a suspense account does not correct the errors, it simply makes the TB balance by putting in an extra balance – the suspense account. Therefore, I suppose when the errors are corrected and the suspense account is got rid off, the entries to the suspense account will be $63,526 Cr.
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