Identify the type of error
A transaction is entered into the wrong account, but the account is of the same class.
Error of commission
Rent of $1,000 was recorded as wages. Which account should be debited to correct the error?
Rent Account
What is a business owned by two or more persons who agree to share the profits
Partnership
What is the amount an employee earns before deductions?
Gross Pay
A transaction is entered into an account that is incorrect because of its nature, such as treating an asset as an expense.
Error of Principle
Office equipment costing $5,000 was recorded as an expense. Which account should be debited?
Office Equipment Account
What document contains the terms and conditions agreed upon by the partners?
Partnership Agreement/Deed
What is the amount an employee receives after deductions?
Net Pay
A transaction is recorded with the wrong amount (less) in both accounts.
Error of original entry
A credit purchase from John of $3,000 was entered in the Sales Account. Which account should be debited to correct the error
Purchases Account
What is the name given to the amount invested by a partner in the business?
Capital
What is money taken from an employee's gross pay?
Deductions
A transaction is completely left out of the accounting records.
Error of omission?
A credit sale of $2,000 to Sarah was completely omitted. What accounts must be used when correcting the error?
Sarah's Account and Sales Account
What is the main purpose of the Partnership Appropriation Account?
To show how the partnership's net profit is distributed among the partners.
An employee earns $60 per hour and works 40 hours. Calculate gross pay.
$2,400
A credit purchase of $4,000 from Maria was recorded in the Purchases Account and Maria's Account as $400.
error of original entry
A payment of $600 to a supplier was recorded as a receipt of $600 from the supplier. What type of error occurred?
Complete reversal of entries
A partnership has a net profit of $60,000. Partners receive salaries totaling $10,000 and interest on capital totaling $5,000. What amount remains to be shared as residual profit?
$45,000
An employee earns $40 per hour for 40 regular hours and $60 per hour for 5 overtime hours. Calculate gross pay.
$1,900