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Verification of accounting records

Learning Outcomes - Verification of Accounting Records

The trial balance

Students will be able to:

  • understand that a trial balance is a statement of ledger balances on a particular date
  • outline the uses and limitations of a trial balance
  • prepare a trial balance from a given list of balances and amend a trial balance which contains errors
  • identify and explain those errors which do not affect the trial balance – commission, compensating,complete reversal, omission, original entry, principle.

Correction of errors

Students will be able to:

  • correct errors by means of journal entries
  • correct errors by means of suspense accounts
  • adjust the profit or loss for an accounting period after the correction of errors
  • understand the effect of correction of errors on a balance sheet.

Bank reconciliation

Students will be able to:

  • understand the use and purpose of a bank statement
  • update the cash book for bank charges, bank interest paid and received, correction of errors, credit transfers, direct debits, dividends, and standing orders
  • understand the purpose of, and prepare, a bank reconciliation statement to include bank errors, uncredited deposits and unpresented cheques.

Control accounts

Students will be able to:

  • understand the purposes of purchases ledger and sales ledger control accounts
  • identify the books of prime (original) entry as sources of information for the control account entries
  • prepare purchases ledger and sales ledger control accounts to include credit purchases and sales,
  • receipts and payments, cash discounts, returns, bad debts, dishonoured cheques, interest on overdue accounts, contra entries, refunds, opening and closing balances (debit and credit within each account).
Revision Notes Article Count:  5
Interactive quizzes Article Count:  13



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