Edexcel A-Level Accounting: Control Accounts and Correction of Errors — Practice Questions

These are original questions written for Marlbridge, in the style and at the standard of the examination. They are not reproduced past-paper questions — examination boards hold copyright in their own papers. Use these alongside the official past papers available free from your board.

Related: Control Accounts and Correction of Errors study guide | Control Accounts and Correction of Errors revision notes

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Section A

1. State why a control account provides an “independent” check on a ledger. [2]

2. State the diagnostic shortcut for suspecting a transposition error. [2]

Section B

3. Prepare a purchases ledger (payables) control account from the following, showing the closing balance:

Opening payables $14 600; credit purchases $68 900; payments to suppliers $61 200; purchases returns $1 400; discounts received $800; contra entry with sales ledger $500. [6]

4. For each error below, state whether it would cause the trial balance to fail to balance, and give the correcting journal entry:

(a) A $920 sale on credit was completely omitted from the books. [3] (b) A cash payment of $360 for rent was posted as a $360 debit to both the rent account and the cash account (correct amount, correct accounts, but posted the wrong way on one side). [3] (c) A $480 purchase of a delivery van was debited to the vehicle repairs (expense) account instead of the van (non-current asset) account. [3]

5. A trial balance fails to balance by $270, credit column short. Show the full four-step suspense account sequence once it is discovered that a $270 discount received was never posted to the discounts received account, and state the effect on profit. [6]

6. A payables control account balance does not agree with the total of the individual payables ledger accounts. Explain what this tells you, and what it does not tell you, about the location of the error. [4]

7. Starting from an originally calculated profit of $42 000, prepare a statement of revised profit given: an omitted $920 credit sale (Q4a) is now recorded; the rent posting error in Q4b is corrected (no profit effect, since both figures were correct); and the van reclassification in Q4c is corrected. [5]

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Answers

1. It is built from different source data — totals from the books of prime entry — than the individual ledger accounts it is checking [1], so if the control account balance and the sum of individual balances disagree, an error is revealed independently of the ledger itself [1].

2. If the trial balance imbalance divides evenly by 9, a transposition (digit-reversal) error should be suspected [1] [1].

3.

	$		$
Payments to suppliers	61 200	Opening balance	14 600
Purchases returns	1 400	Credit purchases	68 900
Discounts received	800
Contra entry	500
Closing balance	19 600
83 500		83 500

Debits correctly entered [1] [1] [1]; credits correctly entered [1]; totals agree [1]; closing balance $19 600 [1].

4. (a) Both sides of the transaction are missing, so the trial balance still balances [1]. Journal: Debit Receivables $920, Credit Sales $920 [1] [1]. (b) Both figures and both accounts are correct, but one side is reversed, so the trial balance fails to balance — this is a one-sided-in-effect error since the debit and credit totals will differ by twice the amount, i.e. $720 [1]. The rent debit itself is already correct and needs no adjustment; only the cash side must be reversed. Journal: Debit Suspense $720, Credit Cash $720 — this removes the wrong $360 debit from the cash account and replaces it with the correct $360 credit in a single entry [1] [1]. (c) Both sides of the original entry were posted somewhere, so the trial balance still balances [1]. Journal: Debit Van (asset) $480, Credit Vehicle repairs (expense) $480 [1] [1].

5. Step 1 — open a suspense account for the $270 shortfall (credit side, since the credit column is the one short) [1]. Step 2 — once the missing posting is found, journalise: Debit Suspense $270, Credit Discounts received $270 [1] [1]. Step 3 — the two suspense entries cancel out, closing the account [1]. Step 4 — discounts received (income) was understated by $270, so profit was originally understated by $270; the statement of revised profit increases profit by $270 [1] [1].

6. It tells you that an error exists somewhere affecting either the control account or the individual ledger accounts [1] [1]. It does not tell you the specific error type, its exact location, or which side (control account vs. individual accounts) is wrong — that requires further investigation, such as re-checking postings or casting [1] [1].

7. Original profit: $42 000 [1]. Add the omitted sale, now recorded: +$920 [1]. Rent posting error: no adjustment, since both figures were already correct and only account-side presentation was wrong, so profit is unaffected [1]. Van reclassification: removed $480 from vehicle repairs (expense), so expenses fall and profit increases by $480; the amount instead becomes a non-current asset and does not appear in the income statement [1]. Revised profit: $42 000 + $920 + $480 = $43 400 [1].

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Where marks are usually lost

• Crediting discounts received on the wrong side of the control account.
• Applying a suspense account to an error, such as omission or an error of principle, that would not actually unbalance the trial balance.
• Forgetting that a reversed-but-correct-figure entry still unbalances the trial balance, since it is effectively a one-sided error of double the true amount.
• Adjusting the statement of revised profit for a correction that only affects the statement of financial position, not an income or expense account.

Approaching control account and error correction questions

Work through every correction in the same fixed order: first classify the error against the specification’s own two-way split (does it affect the trial balance’s balancing or not), then write the correcting journal entry, then state explicitly whether a suspense account is involved, and only then assess the profit effect. Questions that describe a scenario rather than naming the error type are testing whether you can diagnose the category from the description — practise working backwards from “both sides were posted somewhere” (no trial balance effect) or “only one side was posted, or the two sides differ” (trial balance effect) rather than trying to memorise every possible scenario individually.