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Types Of Errors

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FA – FIA FFA › Types Of Errors

  • This topic has 3 replies, 2 voices, and was last updated 1 year ago by John Moffat.
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  • May 7, 2021 at 1:35 pm #619957
    jermy01
    • Topics: 32
    • Replies: 20
    • ☆☆

    ***(Q-1, option 1) An error in the addition in the cash book cause a trial balance not to balance
    then why this error ((Q-2, option 1) discounts received column of the cash payments book was overcast) will be balanced in the trial balance???

    Q-1. Which of the following errors would cause a trial balance not to balance?
    1 An error in the addition in the cash book.
    2 Failure to record a transaction at all.
    3 Cost of a motor vehicle debited to motor expenses account. The cash entry was correctly made.
    4 Goods taken by the proprietor of a business recorded by debiting purchases and crediting drawings account.
    A 1 only
    B 1 and 2 only
    C 3 and 4 only
    D All four items
    answer> 31.14 (A)
    Items (2), (3) and (4) preserve double entry and so would not show up in a trial balance

    Q-2. If a trial balance does not balance, which of the following errors might have caused this?

    (i) The discounts received column of the cash payments book was overcast.
    (ii) Cash paid for the purchase of office furniture was debited to the general expenses account. (iii) Returns inwards were included on the credit side of the trial balance.

    A (i) only
    B (i) and (ii)
    C (iii) only
    D (ii) and (iii)

    answer> 35.5 C In Statement (i) both sides of the double-entry posting from the cash book would be incorrect but equal in value, so this would not cause a trial balance imbalance. In Statement (ii), both expenses and non-current assets are debit balances in the trial balance, so posting to the wrong account, in this case, would not cause a trial balance imbalance.

    May 7, 2021 at 2:27 pm #619967
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 49595
    • ☆☆☆☆☆

    For Q1, it is assuming that they are using an analysed cash book, and therefore if one of the columns is added up wrongly then the wrong amount will have been entered in just one of the accounts in the nominal/general ledger.

    For Q2, discount columns are rarely used these days (and so not very likely to be relevant for the exam). However if there is a discount column then it is only memorandum and at the end of the month the total from the column is debited to payables and credited to discounts received. So the same wrong amount will have been entered in both accounts.

    May 24, 2021 at 12:58 pm #621619
    jermy01
    • Topics: 32
    • Replies: 20
    • ☆☆

    thanks a lot

    May 24, 2021 at 2:54 pm #621632
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 49595
    • ☆☆☆☆☆

    You are welcome 🙂

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