Question:
the acquisition of an item of office equipment for $34600 had been incorrectly treated as a purchase and debited to the purchases account.
i think that should be debit to office equipment, which account should be credit? purchase, stock, trading or suspense?
or u hv another advice?
i'm looking for ur help. thx.
Answer:
Just pass the correction entry....Debit the 'office equipment account' and Credit the 'Purchases account'...However you can also pass the same entry through 'suspense account'.
Credit to purchases, removing original entry.
If there was a delay in discovering the mis-post, there may be additional depreciation to provide on the office equipment.
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