Financial accounting F3 acca Practice questions Financial accounting F3 acca Practice questions Financial accounting F3 acca Practice questions
Trang 1Adjustments to Profit and Suspense
Accounts
Prepared for Educational Purposes
August 14, 2025
Contents
2 Part 2: Answers with Detailed Explanations 9
1
Trang 21 Part 1: List of Questions
This section contains 50 multiple-choice questions based on adjustments to profit and suspense accounts, including trial balance errors, suspense account corrections, and profit adjustments Numbers are left-aligned from 1 to 50
1 Which of the following errors would cause a trial balance not to balance? (Select all that apply)
a Goods taken by the proprietor of a business recorded by debiting purchases and crediting drawings account
b An error in the addition in the cash book
c Failure to record a transaction at all
d Cost of a motor vehicle debited to motor expenses account The cash entry was correctly made
2 A business received a delivery of goods on 29 June 2006, which was included in inventory at 30 June 2006 The invoice for the goods was recorded in July 2006 What effect will this have on the business?
a 1 and 4
b 1 and 2
c 2 and 3
d 1 only
(1) Profit for the year ended 30 June 2006 will be overstated (2) Inventory at 30 June 2006 will be understated (3) Profit for the year ending 30 June 2007 will be overstated (4) Inventory at 30 June 2006 will be overstated
3 Tom’s trial balance failed to agree and a suspense account was opened for the differ-ence Which of the following errors that were found in Toms accounting records would require an entry to the suspense account to correct them? (Select all that apply)
a Cash $2,800 paid for plant repairs was correctly accounted for in the cash book but was credited to the plant asset account
b A cheque for $78,400 paid for the purchase of a motor car was debited to the motor vehicles account as $87,400
c The petty cash book balance $500 had been omitted from the trial balance
d In recording an issue of shares at par, cash received of $333,000 was credited to the ordinary share capital account as $330,000
4 A company’s Statement of Profit or Loss for the year ended 31 December 2005 showed
a net profit of $200,640 It was later found that $43,200 paid for the purchase of a motor van had been debited to the motor expenses account It is the company’s policy
to depreciate motor vans at 25% per year on the straight line basis, with a full year’s charge in the year of acquisition What would the net profit be after adjusting for this error?
a $243,840
Trang 3b $254,640
c $168,240
d $233,040
5 The debit side of a company’s trial balance totals $1,920 more than the credit side Which one of the following errors would fully account for the difference?
a Discount received $960 has been debited to discount allowed account
b The petty cash balance of $1,920 has been omitted from the trial balance
c $960 paid for plant maintenance has been correctly entered in the cash book and credited to the plant asset account
d A receipt of $1,920 for commission receivable has been omitted from the records
6 Which error would require a suspense account entry?
a A sale of $1,000 recorded as $100 in the sales account
b Goods returned by a customer recorded in the wrong account
c A purchase invoice omitted from the records
d A payment to a supplier recorded in the wrong account
7 A businesss profit for the year was $150,000 An expense of $5,000 was incorrectly recorded as an asset What is the corrected profit?
a $145,000
b $155,000
c $150,000
d $140,000
8 The trial balance shows debits exceeding credits by $2,000 Which error explains this?
a A cash receipt of $1,000 recorded as $3,000
b A purchase invoice omitted from the records
c A sale recorded in the wrong account
d A payment recorded in both cash and expense accounts
9 A companys net profit is $100,000 A $10,000 asset purchase was recorded as an expense Depreciation is 20% straight-line with a full years charge What is the corrected profit?
a $108,000
b $110,000
c $102,000
d $112,000
10 Which of the following errors affects the trial balance?
a A sale omitted from the records
b A payment debited to the wrong expense account
Trang 4c A cash receipt recorded as $500 instead of $5,000.
d Goods taken by the owner recorded incorrectly
11 A suspense account shows a credit balance of $3,000 A sales invoice was recorded as
$2,000 instead of $5,000 What is the correcting entry?
a Debit Sales $3,000, Credit Suspense $3,000
b Debit Suspense $3,000, Credit Sales $3,000
c Debit Receivables $3,000, Credit Suspense $3,000
d Debit Suspense $3,000, Credit Receivables $3,000
12 A businesss profit was $80,000 Inventory was overstated by $4,000 at year-end What
is the corrected profit?
a $76,000
b $84,000
c $80,000
d $74,000
13 The trial balance is out by $1,500 (debits exceed credits) Which error explains this?
a A cash payment of $1,500 omitted from the cash book
b A sale recorded in the wrong account
c A purchase invoice omitted from the records
d A cash receipt recorded in the wrong account
14 A companys profit is $120,000 A $6,000 expense was recorded as an asset What is the corrected profit?
a $114,000
b $126,000
c $120,000
d $108,000
15 Which error requires a suspense account entry?
a A purchase recorded in the wrong account
b A cash receipt of $2,000 recorded as $200
c A sale omitted from the records
d A payment recorded in both cash and expense accounts
16 A suspense account has a debit balance of $4,000 A payment of $4,000 was credited
to an expense account instead of cash What is the correcting entry?
a Debit Suspense $4,000, Credit Expense $4,000
b Debit Expense $4,000, Credit Suspense $4,000
c Debit Cash $4,000, Credit Suspense $4,000
Trang 5d Debit Suspense $4,000, Credit Cash $4,000
17 A businesss profit was $200,000 A $10,000 asset purchase was recorded as an expense Depreciation is 10% straight-line What is the corrected profit?
a $209,000
b $210,000
c $208,000
d $211,000
18 The trial balance shows credits exceeding debits by $2,500 Which error explains this?
a A cash receipt of $2,500 recorded as $5,000
b A purchase invoice omitted from the records
c A sale recorded in the wrong account
d A payment recorded in both cash and expense accounts
19 A companys profit is $90,000 Inventory was understated by $3,000 at year-end What
is the corrected profit?
a $87,000
b $93,000
c $90,000
d $96,000
20 Which of the following errors affects the trial balance?
a A sale omitted from the records
b A payment debited to the wrong expense account
c A cash payment recorded as $1,000 instead of $10,000
d Goods taken by the owner recorded incorrectly
21 A suspense account shows a credit balance of $1,000 A purchase invoice was recorded
as $500 instead of $1,500 What is the correcting entry?
a Debit Payables $1,000, Credit Suspense $1,000
b Debit Suspense $1,000, Credit Payables $1,000
c Debit Purchases $1,000, Credit Suspense $1,000
d Debit Suspense $1,000, Credit Purchases $1,000
22 A businesss profit was $50,000 A $2,000 expense was recorded as an asset What is the corrected profit?
a $48,000
b $52,000
c $50,000
d $46,000
Trang 623 The trial balance is out by $3,000 (debits exceed credits) Which error explains this?
a A cash receipt of $3,000 omitted from the cash book
b A sale recorded in the wrong account
c A purchase invoice omitted from the records
d A cash payment recorded in the wrong account
24 A companys profit is $180,000 A $12,000 asset purchase was recorded as an expense Depreciation is 20% straight-line What is the corrected profit?
a $189,600
b $192,000
c $187,600
d $190,400
25 Which error requires a suspense account entry?
a A sale recorded in the wrong account
b A cash receipt of $5,000 recorded as $500
c A purchase omitted from the records
d A payment recorded in both cash and expense accounts
26 A suspense account has a debit balance of $2,000 A sale of $2,000 was credited to receivables instead of sales What is the correcting entry?
a Debit Suspense $2,000, Credit Sales $2,000
b Debit Sales $2,000, Credit Suspense $2,000
c Debit Receivables $2,000, Credit Suspense $2,000
d Debit Suspense $2,000, Credit Receivables $2,000
27 A businesss profit was $250,000 Inventory was overstated by $5,000 at year-end What is the corrected profit?
a $245,000
b $255,000
c $250,000
d $240,000
28 The trial balance shows credits exceeding debits by $1,500 Which error explains this?
a A cash payment of $1,500 recorded as $3,000
b A purchase invoice omitted from the records
c A sale recorded in the wrong account
d A cash receipt recorded in the wrong account
29 A companys profit is $70,000 A $4,000 expense was recorded as an asset What is the corrected profit?
Trang 7a $66,000
b $74,000
c $70,000
d $62,000
30 Which of the following errors affects the trial balance?
a A sale omitted from the records
b A payment debited to the wrong expense account
c A cash receipt recorded as $2,000 instead of $20,000
d Goods taken by the owner recorded incorrectly
31 A suspense account shows a credit balance of $2,500 A cash receipt was recorded as
$1,000 instead of $3,500 What is the correcting entry?
a Debit Cash $2,500, Credit Suspense $2,500
b Debit Suspense $2,500, Credit Cash $2,500
c Debit Receivables $2,500, Credit Suspense $2,500
d Debit Suspense $2,500, Credit Receivables $2,500
32 A businesss profit was $300,000 A $15,000 asset purchase was recorded as an expense Depreciation is 25% straight-line What is the corrected profit?
a $311,250
b $315,000
c $308,750
d $312,250
33 The trial balance is out by $4,000 (debits exceed credits) Which error explains this?
a A cash payment of $4,000 omitted from the cash book
b A sale recorded in the wrong account
c A purchase invoice omitted from the records
d A cash receipt recorded in the wrong account
34 A companys profit is $110,000 Inventory was understated by $5,000 at year-end What is the corrected profit?
a $105,000
b $115,000
c $110,000
d $120,000
35 Which error requires a suspense account entry?
a A purchase recorded in the wrong account
b A cash payment of $3,000 recorded as $300
Trang 8c A sale omitted from the records.
d A payment recorded in both cash and expense accounts
36 A suspense account has a debit balance of $1,000 A purchase invoice was credited to sales instead of payables What is the correcting entry?
a Debit Suspense $1,000, Credit Sales $1,000
b Debit Payables $1,000, Credit Suspense $1,000
c Debit Sales $1,000, Credit Suspense $1,000
d Debit Suspense $1,000, Credit Payables $1,000
37 A businesss profit was $90,000 A $3,000 expense was recorded as an asset What is the corrected profit?
a $87,000
b $93,000
c $90,000
d $84,000
38 The trial balance shows credits exceeding debits by $2,000 Which error explains this?
a A cash receipt of $2,000 recorded as $4,000
b A purchase invoice omitted from the records
c A sale recorded in the wrong account
d A cash payment recorded in the wrong account
39 A companys profit is $200,000 A $10,000 asset purchase was recorded as an expense Depreciation is 20% straight-line What is the corrected profit?
a $208,000
b $210,000
c $206,000
d $212,000
40 Which of the following errors affects the trial balance?
a A sale omitted from the records
b A payment debited to the wrong expense account
c A cash payment recorded as $5,000 instead of $50,000
d Goods taken by the owner recorded incorrectly
41 A suspense account shows a credit balance of $3,500 A sale was recorded as $2,000 instead of $5,500 What is the correcting entry?
a Debit Sales $3,500, Credit Suspense $3,500
b Debit Suspense $3,500, Credit Sales $3,500
c Debit Receivables $3,500, Credit Suspense $3,500
Trang 9d Debit Suspense $3,500, Credit Receivables $3,500
42 A businesss profit was $400,000 Inventory was overstated by $6,000 at year-end What is the corrected profit?
a $394,000
b $406,000
c $400,000
d $388,000
43 The trial balance is out by $5,000 (debits exceed credits) Which error explains this?
a A cash receipt of $5,000 omitted from the cash book
b A sale recorded in the wrong account
c A purchase invoice omitted from the records
d A cash payment recorded in the wrong account
44 A companys profit is $130,000 A $8,000 expense was recorded as an asset What is the corrected profit?
a $122,000
b $138,000
c $130,000
d $118,000
45 Which error requires a suspense account entry?
a A sale recorded in the wrong account
b A cash receipt of $4,000 recorded as $400
c A purchase omitted from the records
d A payment recorded in both cash and expense accounts
46 A suspense account has a debit balance of $2,500 A payment was credited to sales instead of cash What is the correcting entry?
a Debit Suspense $2,500, Credit Sales $2,500
b Debit Cash $2,500, Credit Suspense $2,500
c Debit Sales $2,500, Credit Suspense $2,500
d Debit Suspense $2,500, Credit Cash $2,500
47 A businesss profit was $500,000 A $20,000 asset purchase was recorded as an expense Depreciation is 25% straight-line What is the corrected profit?
a $515,000
b $520,000
c $510,000
d $525,000
Trang 1048 The trial balance shows credits exceeding debits by $3,000 Which error explains this?
a A cash payment of $3,000 recorded as $6,000
b A purchase invoice omitted from the records
c A sale recorded in the wrong account
d A cash receipt recorded in the wrong account
49 A companys profit is $150,000 Inventory was understated by $7,000 at year-end What is the corrected profit?
a $143,000
b $157,000
c $150,000
d $164,000
50 Which of the following errors affects the trial balance?
a A sale omitted from the records
b A payment debited to the wrong expense account
c A cash receipt recorded as $3,000 instead of $30,000
d Goods taken by the owner recorded incorrectly
2 Part 2: Answers with Detailed Explanations
1 b, d An error in the addition in the cash book, Cost of a motor vehicle debited
to motor expenses account Explanation: Cash book addition errors and incorrect
debits (e.g., motor vehicle to expenses) cause imbalances in the trial balance
2 a 1 and 4 Explanation: Including inventory without recording the payable
over-states 2006 profit and inventory (net assets)
3 b, c, d Cheque for $78,400 debited as $87,400, Petty cash balance $500 omitted,
Cash received $333,000 credited as $330,000 Explanation: These errors create
imbalances requiring suspense account entries to correct
4 a $243,840 Explanation: Net profit $200,640 + Reverse expense $43,200 -
Depre-ciation (25% of $43,200 = $10,800) = $243,840
5 b The petty cash balance of $1,920 has been omitted from the trial balance Expla-nation: Omitting a $1,920 debit balance explains the debit side exceeding credits by
$1,920
6 a A sale of $1,000 recorded as $100 in the sales account Explanation: Understating
the credit to sales creates an imbalance requiring a suspense entry
7 a $145,000 Explanation: Profit $150,000 - Expense $5,000 (reversed from asset) =
$145,000
8 a A cash receipt of $1,000 recorded as $3,000 Explanation: Overstating the debit
to cash by $2,000 explains debits exceeding credits
9 a $108,000 Explanation: Profit $100,000 + Reverse expense $10,000 - Depreciation