Correcting Reversed Ledger Posting with Suspense

Steps:

• Correct entry: Debit Bank $450, Credit Fatima$450.
• Error: Posting to Fatima reversed to Debit Fatima $450, so Fatima shows Debit$450 instead of Credit $450.
• Discrepancy: Debits exceed credits by $900; Fatima needs$900 credit to reach correct Credit $450 balance.
• Correction: Debit Suspense $900 (temporary), Credit Fatima$900.

Why D is correct:

• Reversal error doubles the impact ($450 missing credit +$450 extra debit = $900 discrepancy), so suspense debits$900 and Fatima credits $900 per trial balance adjustment rules.

Why the others are wrong:

• A: Credits Fatima only $450, leaving$450 discrepancy uncorrected.
• B: Debits Fatima $450 more, increasing error to$900 debit.
• C: Involves bank (already correct) and uses $450, ignoring full$900 imbalance.

Final answer: D