Page 305 - Accountancy_F5

Solution 9.7 (a)

Msusa & Company’s general journal
Date Details TZS TZS
Jan. 1 Sales account 700,000
Suspense account 700,000
FOR ONLINE READING ONLY
Being the amount over casted in sales account
now corrected
Feb. 2 Rent expenses account 800,000
Suspense account 800,000
Being the amount under-casted in Rent account
LANGUAGE EDITING
now correct
May 5 Suspense account 500,000
Chombo account 500,000
Being the amount received from Chombo post-
ed only in the cashbook now corrected
June 6 Purchase account 360,000
Creditors 360,000
Being the amount understated in creditors and
purchases account now corrected

Solution 9.7 (b)
Msusa & Company’s suspense account
Date Details TZS Date Details TZS
2022 2022
May 5 Chombo 500,000 Jan. 1 Sales 700,000
Difference on TB 1,000,000 Feb. 2 Rent expenses 800,000
1,500,000 1,500,000

Solution 9.7 (c)
Msusa & Company

Corrected income statement for the year ending 31st July 2022
Net profit as reported 3,200,000

Less: Purchases understated 360,000
Overcasted sales 700,000
Undercasted rent 800,000 1,860,000
Corrected net profit 1,340,000

Student’s Book Form Five
292

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