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Suspense accounts have been a troubling issue whilst studying Paper 1.1 maybe it just
requires more practice. As such, I have decided to present some tips that I found to be
1. You must have a very good understanding of the errors, especially those that
require the use of suspense accounts.
2. Obviously a sound knowledge of the double entry system.
3. Even when journal entries aren‟t required, please make sure to prepare them
for each error, as it will indefinitely lead you to solving the problem correctly.
Furthermore, if you follow the following steps, you shouldn‟t go wrong:
Identify the type of each error or adjustment, if it requires a suspense account,
mark it with an „S‟, if it requires a journal entry mark it with a „JE‟, otherwise, mark it
with an X. Nearly all errors require journal entries, even those that need suspense
accounts such as:
a) Casting Errors
b) Posting Errors (only those affecting the balance). Those not affecting the
balance only require journal entries.
c) All trial balance errors that affect the balance, e.g. something is omitted or
incorrectly extracted to the trial balance, etc.
d) Deliberate errors, these are due to the accountant deliberately trying to make
the trial balance „balance‟.
Once you‟re done with step 1, try to picture the affect of the error in your mind, try to
tell yourself for example “the result of this error is that the sum of the debits of the
trial balance is larger than the sum of credits”, which means that to correct this error,
you need to do the opposite.
If the debits are greater than the credits, then you immediately know that we need
more credits to balance the account, so we need to CREDIT the suspense account
with the difference.
a) DR>CR then CR the suspense account with the difference
b) CR>DR then DR the suspense account with the difference
Let us look at the following situations, remember you need to think about three
important matters regarding each error:
1. Do they affect the trial balance?
2. What kind of account are they affecting?
a) Assets or Expenses?
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