Accounting Question

alan4cult

A little confused on a Suspense Account Working:



It says that the supplier sent him a credit note for the transport charge. Shouldn't this be a debit note or an invoice? If you work through treating it as a credit note, you don't get the correct answer. Help?

Mars Bar

This is what I did....

I put the 8900 on the credit of the Purch Rets and on the debit of the Creditors...
Then I opened another Cred account and credited it with 9600 and opened a susp account and debited it with 9600 as "this was the only entry made in respect of the credit note...".

Now you see the first figure, the 9800, well you take the 200 away from that and put it under the 8900 in the Purch Rets and (the first)Creditors account. 9600 is the figure you should have had so you have 700 too little so you put it in the credit side of the Purch Rets and in the debit side of (the first)Creditors account.

In your journal you should have:
Suspense l l 9600 l(credit side)
Creditors l 9600 l l (Debit side)
Creditors l 700 l l (" " )
Purch Rets l l 700 l (Credit side)

That probably made little or no sense at all because it doesn't but it is a foolproof way my teacher has devised and is only there to get ya through the leaving. Honesty, it is possibly the worst way of teaching it(my teacher says so herself) but it works...


If anyone has a better way of doing it then fire away...