Neco 2025 Financial Accounting Question 31

Practice objective / multiple choice question 31 from the 2025 Neco Financial Accounting examination.

Neco 2025 Financial Accounting Objective / Multiple Choice Medium Difficulty
Question 31 NECO • 2025 • FINANCIAL_ACCOUNTING • objective

During June, a purchase of inventory costing ₦45,000 was paid by cheque. The accountant mistakenly debited Purchases ₦54,000, credited Bank ₦45,000, and posted the missing ₦9,000 credit to the Suspense Account. Identify the type of error, state the amount that must be transferred from the Suspense Account to the Bank, and give the correcting journal entries required to rectify the books.

Answer Options

A. Transfer ₦9,000 from Suspense to Bank. Correcting entries: (i) Debit Purchases ₦9,000, Credit Suspense ₦9,000; (ii) Debit Bank ₦9,000, Credit Suspense ₦9,000.
Correct Answer B. Transfer ₦9,000 from Suspense to Bank. Correcting entries: (i) Debit Suspense ₦9,000, Credit Purchases ₦9,000; (ii) Debit Bank ₦9,000, Credit Suspense ₦9,000.
C. Transfer ₦9,000 from Suspense to Bank. Correcting entries: (i) Debit Suspense ₦9,000, Credit Purchases ₦9,000; (ii) Debit Purchases ₦9,000, Credit Bank ₦9,000.
D. Transfer ₦9,000 from Bank to Suspense. Correcting entries: (i) Debit Suspense ₦9,000, Credit Purchases ₦9,000; (ii) Debit Bank ₦9,000, Credit Suspense ₦9,000.
Correct Answer
B
Correct Option:
Transfer ₦9,000 from Suspense to Bank. Correcting entries: (i) Debit Suspense ₦9,000, Credit Purchases ₦9,000; (ii) Debit Bank ₦9,000, Credit Suspense ₦9,000.

About This Question

This is Neco 2025 Financial Accounting Question 31. It is one of the objective questions from the 2025 Neco Financial Accounting examination.

Difficulty level: Medium .

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