Struggling with journal and correction of errors!

vickiilouise91

Most of the corrections I find easy to understand but one I'm really struggling to get my head around is the reversal of entries.
Its the only one I can't really seem to grasp.
Can anyone help me understand it a little easier?

Also, I'll be booking my first exam after doing the course distance learning and I'm wondering if anyone has any revision tips so it'll stick in my brain?

This is my first Level at AAT so it'll be my first ever AAT exam!

PeterC

Try looking at "Error Correction" (example 4) in the Encyclopaedia of Accounting http://meadowgatetraining.co.uk/resources/Error+correction.pdf

sdv

Reversal of entries = Debit entry posted as Credit entry OR Credit entry posted as Debit entry

Debit=Credit therefore TB will balance; but there is an error in accounting.

eg of an error: a Telephone expense of £30 posted as
Debit Bank £30 - effect this has increased the assets instead of reducing it
Credit Telephone £30 - effect reduce expenses instead of increasing it

To Correct; - Post the entries TWICE
Once to correct the Error
Credit Bank £30 - Reverse the original entry to correct the error
Debit Telephone £30 - Reverse the original entry to correct the error

Second time to post the correct entry
Credit Bank £30 - Reduce the asset - correct entry
Debit Telephone £30 - Increase the expense - correct entry