No. 2(a): Below is the completed table showing the book of original entry for each of the source information given:
No. 2(b): Below is the Purchases Ledger Control Account of L. Somerset for the month of October, 2012:
No. 2(c): Correction of errors:
Error (i): This is an error of principle where the correct entry was made but to the wrong type of account. To correct this error the Purchases Account needs to be reduced by $2,100 and the Equipment Account increased by $2,100. To achieve this the Purchases Account need to be credited and the Equipment Account debited with $2,100.
Error (ii): This is an error of transposition where a transaction totaling $12,690 was recorded as $12,960 in the bank account. This is a one sided error that would affect the suspense account as the information given does not state that this error occurred in the creditor’s account as well. To correct this error the Bank Account needs to be increased by $270 as the payment was overstated by this amount. To achieve this the Bank Account needs to be debited and the Suspense Account credited with $270.
No. 2(c): Below is the General Journal of L. Somerset for the month of October, 2012 showing the entries to correct the two errors discovered:
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The author holds a Bsc (Hons) Degree in Applied Accounting from Oxford Brookes University, England and enjoys a successful career as an Accounting Supervisor and a private tutor.