CORRECTION OF ERRORS ASSIGNMENT

B Bolder is a sole trader. She has just completed her accounts for the year ended 31 December 2017. Her net profit for the year was calculated as shs3, 897. However, during the following month these errors were discovered:

1. The returns inwards day book was overcast by shs320.
2. Sales of shs430 on credit to I Mellor were entered in the sales account as shs240.
3. Bolder introduced her own computer into the business at a valuation of shs 295. However, this was credited to sales by mistake.
4. Sundry expenses of shs76 cash was entered in both accounts as a credit entry.
5. A payment by cheque of shs25 to M Smith was entered in both accounts as shs252.

Show the corrections needed for the above errors in the Journal.

Open up a suspense account and make entries as appropriate in correcting the errors thus showing the correct opening balance on the suspense account.

Produce a statement of corrected net profit

1. D Madgett is a sole trader. He has just completed his accounts for the year ended 31 May 2010. His net profit for the year was calculated as shs1,760. However, during the following month these errors were discovered:

1. Sales of goods on credit for shs430 to B Street were credited to both accounts.
2. Returns inwards of shs65 were credited to returns outwards as shs95.
3. Motor expenses of shs145 were debited to motor expenses as shs154.
4. A sale of an old motor van for shs580 was treated as a sale of stock by mistake.
5. Wages of shs760 paid by cash was entered in the wrong side of both accounts.

• Show the corrections needed for the above errors in the Journal.
• Open up a suspense account and make entries as appropriate in correcting the errors thus showing the correct opening balance on the suspense account.
• Produce a statement of corrected net profit.

The net profit for M Jeffs for the year ended 31 March 2007 had been calculated as shs390.

However, the following errors were discovered in April 2007:

• The returns inwards day book had been undercast by shs82.
• Insurance paid by cheque for shs27 included a payment for private insurance of shs12.
• Discounts allowed of shs 25 were credited to the account by mistake.
• A purchase of goods on credit for shs 45 from A Wood was entered in both accounts as shs 54.
• Carriage outwards paid in cash of shs 28 was entered in the cash account as shs18.

1. Show the corrections needed for the above errors in the Journal.
2. Open up a suspense account and make entries as appropriate in correcting the errors thus showing the correct opening balance on the suspense account.
3. Produce a statement of corrected net profit.