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1st Puc Accountancy Unit 6 Trial Balance And Rectification Of Errors Notes | ಪ್ರಥಮ ಪಿಯುಸಿ ಲೆಕ್ಕಶಾಸ್ತ್ರ ಅಧ್ಯಾಯ – 6 ನೋಟ್ಸ್

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1st Puc Accountancy Chapter 6 Notes

1st Puc Accountancy Unit 6 Trial Balance And Rectification Of Errors Notes | ಪ್ರಥಮ ಪಿಯುಸಿ ಲೆಕ್ಕಶಾಸ್ತ್ರ ಅಧ್ಯಾಯ - 6 ನೋಟ್ಸ್
1st Puc Accountancy Unit 6 Trial Balance And Rectification Of Errors Notes

One And Two Marks Qs

Q1.What is Trial balance?

A: Trial balance is the list of all debit and credit balances of accounts taken out from the ledger at a given period.

Q2. Write the objective of preparing trial balance.

  • To know the arithmetical accuracy of the books of accounts.
  • To identify any mistakes in the books of accounts entered.
  • It contains all the accounts in a summarised from.
  • To prepare final accounts of a concern

Q3. Write the methods of preparing trail balance

  1. Balance method
  2. Total method
  3. Balance and total (mixed) method.

Q4. Write The principles of preparation of trial balance.

A: The principle of preparation of trial balance is debit entry have automatic
credit on some other account.

Q5. Write the features of trial balance.

  • It is a extraction of ledger balance
  • It is prepared on a particular date.
  • It is not the account it is a statement of balances.

Q6. Write the specimen of trial balance.

A: Trial balance of m/s subhas publishing House as on 31-3-2011

SI. NoHead of accounts LF DebitDebit

Q7. Write any four items appeared on debit side of trial balance.

A: The items appeared in debit side of trial balance are:

  1. Purchases
  2. Sales Return.
  3. Building
  4. Cash balance.

Q8. Write any four items appeared on credit side of trial balance.

A: The items appeared in tigebgGce credit side are :

  1. Sales
  2. Purchase
  3. Capital
  4. Interest received

Q9. Write any four items not recorded in trial balance.

A: Items not appeared in trial balance are :

  1. Closing stock
  2. Salary payable
  3. Commission receivable
  4. Depreciation provision during the year

Q10. What is suspense a/c?

A: It is a temporary a/c in which the difference in Trial balance is placed and is
wiped off when the errors are locked.

Q11. What is an accounting Errors?

A: Errors mistakes committed by the book-keeper while writing of accounts

Q12. Write the different types of errors.

  • Errors of commission
  • Errors of ommission
  • Errors of principle
  • Compensating errors

Q13. What do you mean by errors of ommission

A: It is an error where a transaction is completely ommited or not recorded in the books of account.

Q14. What is errors of commission?

A: It is an error where a transactions has been wrongly entered in a subsidiary book or posting to wrong a/c.

Q15. What is errors of principles?

A: It is an error where a transaction is not recorded strictly in accordance with principles of double entry system.

Q16. What is suspense account?

A: It is Temporary account opened for recording the difference in trial balance and written off after errors are located.

Q17. Write the meaning of two sides errors.

A: Any errors affects both side aspects of transaction, (debit and credit ) it is called
two sides errors.

Q18. State any two examples for errors of Omission

A: Examples for omission are :

  1. Purchase goods from a recorded in purchase book. It is a omission of original entry
  1. Sold goods to Mary recorded in sales book but not posted to ledger. It is a omission of postings

Q19. Write the meaning of compensating errors.

A: It is an error where one error committed on one account is compensated by
some other error . on another account.

Q20. Write the meaning of one side error. Give example.

A: Any errors affects only one side, either debit or credit aspects of transaction it
is called one side error. Example : Pasting Rs. 500 as Rs. 50.

1st Puc Accountancy Chapter 6 Notes

Six Marks Qs

Q1. Give two examples of errors of principle.

A: Errors that are committed when recording of transactions is done against the accounting principle are known as Errors of principle. Here are some examples of the same.

(i) Wages paid for construction of building debited to Wages Account

In this transaction, wages paid for the construction of building is a capital expenditure, so the building account should have been debited. However, it is treated as a revenue expenditure and Wages Account is debited. It is not in accordance with the accounting principle and hence is an error.

(ii) Amount spent on repair of machinery debited to Machinery Account

In this transaction, amount of repair on machinery is a revenue expenditure. It should have been debited as ‘Repairs’, but it is wrongly debited to the Machinery Account which is an error of principle.

Karnataka 1st PUC Accountancy Chapter 6 Trial Balance and Rectification of Errors Notes Pdf 2023

Q2. What are the methods of preparing trial balance?

A: Below are diagrammatically explained methods to prepare Trial Balance.

Methods of Preparing Trial Balance

The following are the methods of preparing trial balances.

Totals method: In Totals method, the total of each side (debit and credit) of the ledger account is determined individually and then it is shown in the trial balance in each of the respective columns. Accounting is based on the double entry system, therefore the total of debit column and the total of credit column in the trial balance should be in agreement with each other.

Balances Method: In this method the closing balances of all accounts are tabulated in a different sheet. In this method brought down balances are brought to this statement.

Totals-cum-balances Method: It utilizes both the totals method and balances method. There are four columns, of which two columns are for writing debit and credit totals of accounts while, two columns are for writing the debit and credit balances of these accounts.

Q3. What is a suspense account? Is it necessary that suspense account will balance off after rectification of the errors detected by the accountant? If not, then what happens to the balance still remaining in suspense account?

A:There may be instances when the total of the debit column is not matching with that of the credit column. At that time the difference of the trial Balance is added to a temporary account to avoid delay in preparation of the financial statements. Such accounts are known as Suspense account. Suspense account is a temporary account in a company which contains unclassified debits and credits. If the debit column falls short of the credit column, then the Suspense Account is debited and vice versa.

Errors as soon as detected and rectified, results in Suspense Account being automatically closed (i.e. becoming zero). However, if still any difference exists, then it is transferred to the Balance Sheet. If the Suspense Account shows a debit balance, then it is recorded in the Assets side and if the Suspense Account shows a credit balance, then it is recorded in the Liabilities side of the Balance Sheet.

Q4. What are the steps taken by an accountant to locate the errors in the trial balance?

A:An accountant can take the following steps to locate errors in the Trial Balance:

  1. Determine the errors if any by re-recording debit and credit entries in the trial balance.
  2. Check for any omission of account and recording that entry in trial balance.
  3. Check trial balances of previous year and compare with the current year.
  4. Check correctness of all ledgers
  5. Half the difference, then check whether any amount is posted in the wrong column of the Trial Balance.
  6. Try to divide the difference by 9, if it is completely divisible, then it’s an error of transposition of figure, i.e. 123 is written as 132.
  7. Entries of Subsidiary Books should be checked once again if there is difference of Rs 1, Rs 10, Rs 100, Rs 1000, etc., if difference still exists and it is not possible to detect the reason for the difference, then for the time being, that particular difference is transferred to the suspense account in order to proceed further.

Q5. What kinds of errors would cause difference in the trial balance? Also list examples that would not be revealed by a trial balance?

A:The errors that lead to the differences in the Trial Balance are termed as one-sided errors. These errors affect only one account. Here are some types of errors that can cause difference in trial balance

  1. If any account is wrongly casted, it is termed as the error of casting.
  2. If balances from previous year’s books or from one end of page to another is wrongly carried forward. These types of errors are termed as the errors in carrying forward.
  3. If entries are posted in completely wrong side of the accounts.
  4. On Posting of a wrong amount in account, this is termed as the error of posting.
  5. If entries are recorded partially, then due to the error of partial omission the trial Balance does not agree.

Here are a few examples that would not be revealed in a Trial Balance:

  1. Purchases made from Raj, recorded in Rohit’s Account, who is another creditor
  2. Wages paid for construction of building, recorded in the Wages Account

Q6. State the limitations of trial balance?

A: There are some errors that are not revealed by a Trial Balance. This inadequacy of the Trial Balance is termed as the limitations of Trial Balance. Here are some of the limitations of a trial balance.

  • It is unable to detect errors known as Errors of Complete Omission which arise when an entry is not recorded in the Journal.
  • It is unable to detect errors known as Compensatory Errors which is the effect of one error that is cancelled by the effect of another error.
  • The Trial Balance fails to reflect errors such as if correct amount is posted in the correct side; but, in the wrong account and if wrong amount is posted in the wrong side, but in the correct account.
  • It is unable to detect errors of principle that may take place in the account.
  • It is unable to detect errors due to wrong entry in accounts, which can lead to errors.

Q7. Describe the purpose for the preparation of trial balance.

A: Here are some points which explain the purpose of preparation of trial balance:

1. Instituting the arithmetical accuracy: When the sum of debit balance accounts equals to sum of credit balance accounts, it is presumed that posting from journal to the particular accounts is arithmetically correct.

2. Summarising the ledger accounts: It acts as a consolidated statement, providing a complete list of all the accounts. In this way, a Trial Balance provides a summarised version of each account.

3. Preparation of final accounts: The Trial Balance acts as a summarised version of each account, so different accounts can be directly transferred to Balance Sheet, Trading, and Profit and Loss Account without actually referring to different ledgers.

4. Identifying and rectifying errors: If the Trial Balance is not in agreement, the indications are of the occurrence of arithmetical error, which can be easily determined. Trial balance is only restricted to determine arithmetical errors.

Q8. As an accountant of a company, you are disappointed to learn that the totals in your new trial balance are not equal. After going through a careful analysis, you have discovered only one error. Specifically, the balance of the Office Equipment account has a debit balance of Rs. 15,600 on the trial balance. However, you have figured out that a correctly recorded credit purchase of pen-drive for Rs 3,500 was posted from the journal to the ledger with a Rs. 3,500 debit to Office Equipment and another Rs. 3,500 debit to creditor’s accounts. Answer each of the following questions and present the amount of any misstatement:

(a) Is the balance of the office equipment account overstated, understated, or correctly stated in the trial balance?

(b) Is the balance of the creditors account overstated, understated, or correctly stated in the trial balance?

(c) Is the debit column total of the trial balance overstated, understated, or correctly stated?

(d) Is the credit column total of the trial balance overstated, understated, or correctly stated?

(e) If the debit column total of the trial balance is Rs. 2, 40,000 before correcting the error, what is the total of credit column?

A: According to the given information, trial balance does not agree. Pen-drive falls under stationery and is wrongly debited to office equipment account, instead of stationery account and also supplier account is debited instead of crediting. Due to these mistakes, the following errors are committed:

  1. The balance of office equipment is overstated by Rs 3,500.
  2. The balance of creditors account is understated by Rs 7,000.
  3. The total of the debit column of the trial balance is correctly stated.
  4. The total of the credit column of the trial balance is understated by Rs 7,000.
  5. If the total of the debit column of the trial balance is Rs 2,40,000 then before rectifying error, total of the credit column of the trial balance is Rs 2,33,000 (i.e., Rs 2,40,000 − Rs 7,000).

1st Puc Accountancy Chapter 6 Notes

Twelve Marks Qs

Q1. Explain errors of principle and give two examples with measures to rectify them.

A: When recording of transactions in the original book of entry is done against the accounting principle, it leads to errors which are known as Errors of principle. These errors are not reflected in the Trial Balance. These errors are committed when there is no proper distinction between capital expenditure and revenue expenditure, or vice versa or between capital income and revenue income or vice versa.

The following examples will help with the process of understanding and rectification of such errors.

Let us consider first example. Wages paid for construction of building are debited to Wages Account.

Wrong entry made is:

Wages A/c Dr.

To Cash A/c

( Wages paid in cash)

In this case, Wages is paid for the construction of building which is a capital asset and hence it should be treated as a capital expenditure and by rule should be debited to the building account. But, the Wages Account is wrongly debited.

Thus, the correct entry that should have been made is:

Building A/c Dr

To Cash A/c

(Wages paid for constructionof building)

In order to rectify this error, the entry for rectification should be:

Building A/c Dr

To Wages A/c

(Wages paid for constructionof building was debited to Wages Account, now rectified)

The second example of errors of principle is the sale of old machinery recorded as sales.

Wrong entry made:

Cash A/c Dr

To Sales A/c

(Sales of old machinery, recorded as sales)

In the above case, the sale of old machinery should not be recorded as sales; in fact the Machinery Account should be credited. Thus, the correct entry that should have been made is:

Cash A/c Dr

To Machinery A/c

(Old machinery sold for cash)

The error can be rectified in the following manner: Sales Account will be debited, as it is wrongly credited and machinery will be credited, as it will not be recorded in the books. Thus, the rectifying entry will be:

Sales A/c Dr

To Machinery A/c

(Sale of old machinery recorded as sales, now rectified)

Q2. Explain the errors of commission and give two examples with measures to rectify them.

A: Errors of commission refer to those errors that are committed when transactions are recorded with wrong amounts, wrong balancing, and wrong posting and/or wrongly carried forwarded. The following examples will illustrate the process of understanding and rectification of such errors.

  1. Let us consider the first example. Sales made to Mr. Y of Rs10, 000 recorded as 1,000 from invoice.

In this case, Mr. Y’s account has been debited with Rs 1,000 instead of Rs 10,000; hence, the error of commission has taken place. A further debit of Rs 9,000, is required in order to rectify this error of commission. The following entry will rectify it:

Mr Y’s A/c Dr.
To Sales A/c
(Goods sold to Mr Y of Rs 10,000 was wrongly posted as Rs 1,000,now rectified)
9,000


9,000

2. Sales returns from Manu for Rs. 1,500 was posted to his account as Rs. 1,000

In this case, Manu’s account is credited with 1000 instead of 1,500, so the rectification entry should be

Suspense A/c Dr. 500

To Manu’s A/c 500

Q3. What are the different types of errors that are usually committed in recording business transaction?

Errors in Business Transaction

Here are some of the types of errors that are committed in recording business transactions:

1. Errors of omission: Error of omission is committed when an entry gets omitted during recording in the book of original entry or during posting of the transaction. Two types of errors of omission are there, namely,

Partial omission: A transaction that is correctly recorded in one side of account but not recorded in the other side of the account. For example, goods sold to Manjunath recorded in sales but omitted to be recorded in Manjunath’s account. It affects the trial balance.

Complete omission: When a transaction gets completely omitted to be recorded in the books, then it is the case of complete omission. For example, transaction related to purchase of goods from Rajesh is not recorded in the purchases book. Such omissions does not affect the trial balance.

2. Errors of principle: Errors committed when recording of transactions in the book of the original entry is done against the accounting principle. Such errors affect the trial balance.

When proper distinction is not made between revenue income or expenditure and capital income or expenditure. These are of two types:

When revenue transactions are treated as capital transactions and when capital transactions are treated as revenue transactions. For example, repairs made to machinery, recorded in machinery account.

3. Errors of commission: Errors committed when transactions are recorded with wrong amounts, wrong posting, wrong balancing, and/or wrongly carry forwarded.

These are of two types:

Trial balance does not agree: One sided errors result when trial balance does not agree, it affects one account

Trial balance agrees: When the trial balance agrees it should not be thought that there is no error. Although arithmetic errors will not be there, but there can be some other types of errors which are not easily detectable. These errors arise due to recording wrong amount in the original book.

4. Compensating errors: Compensating errors occur when effects of one error are cancelled by the effects of another error of an equal amount. For example, Mr. Y’s account was credited by Rs 1,000 instead of 100 and Mr. Z’s account was credited by Rs 100 instead of 1,000. In this case, the error in Mr. Y’s account will be compensated by the error in Mr. Z’s account.

Q4. Rectify the following errors:

(i) Credit sales to Mohan Rs 7,000 were not recorded.

(ii) Credit purchases from Rohan Rs 9,000 were not recorded.

(iii) Goods returned to Rakesh Rs 4,000 were not recorded.

(iv)Goods returned from Mahesh Rs 1,000 were not recorded. 

The solution for all the rectification of errors is as follows

Journal Recordings to rectify the errors

DateParticularsL.FDebit
Amount
Credit
Amount
iMohan’s Account Dr.
To Sales A/c
(Credit Sales to Mohan, Error rectification recording, not recorded earlier)
7,000


7,000
iiPurchases Account Dr.
To Rohan’s A/c
(Credit purchases from Rohan, Error rectification recording, not recorded earlier)
9,000



9,000
iiiRakesh’s Dr.
To Purchases Return A/c
(Purchases return to Rakesh, Error rectification recording, not recorded earlier)
4,000


4,000
ivSales Return A/c Dr.
To Mahesh’s A/c
(Purchases return from Mahesh, Error rectification recording, not recorded earlier)
1,000


1,000

Q5. Rectify the following errors:

(i) Credit sales to Mohan Rs 7,000 were recorded as Rs 700.

(ii) Credit purchases from Rohan Rs 9,000 were recorded as Rs 900.

(iii) Goods returned to Rakesh Rs 4,000 were recorded as Rs 400.

(iv) Goods returned from Mahesh Rs 1,000 were recorded as Rs 100.

The solution for all the rectification of errors is as follows

Journal Recordings to rectify the errors

DateParticularsL.FDebit
Amount
Credit
Amount
iMohan’s Account Dr.
To Sales A/c
(Credit Sales to Mohan, Error rectification recording, ₹ 7,000 was recorded as ₹ 700)
6,300


6,300
iiPurchases Account Dr.
To Rohan’s A/c
(Credit purchases from Rohan, Error rectification recording, ₹ 9,000 was recorded as ₹ 900)
8,100



8,100
iiiRakesh’s Account Dr.
To purchases return A/c
(Goods returned to Rakesh, Error rectification recording, ₹ 4,000 was recorded as ₹ 400)
3,600



3,600

ivSales Return Account Dr.
To Mahesh’s A/c
(Goods returned from Mahesh, Error rectification recording, ₹ 1,000 was recorded as ₹ 100)
900



900

Q6. Rectify the following errors:

(i) Credit sales to Mohan Rs 7,000 were rcorded as Rs 7,200.

(ii) Credit purchases from Rohan Rs 9,000 were recorded as Rs 9,900.

(iii) Goods returned to Rakesh Rs 4,000 were recorded as Rs 4,040.

(iv) Goods returned from Mahesh Rs 1,000 were recorded as Rs 1,600.

Journal Recordings to rectify the errors

DateParticularsL.FDebit
Amount
Credit
Amount
iSales A/c Dr.
To Mohan’s A/c
(Credit Sales to Mohan, Error rectification recording, ₹ 6,000 was recorded as ₹ 6,200)
200


200
iiRohan’s A/c Dr.
To Purchases A/c
(Goods purchased from Rohan, Error rectification recording, ₹ 9,000 was recorded as ₹ 9,900)
900



900

iiiPurchases Return A/c Dr.
To Rakesh’s A/c
(Goods returned to Rakesh, Error rectification recording, ₹ 4,040 was recorded as ₹ 4,000)
40


40
ivMahesh’s A/c Dr.
To Sales return A/c
(Goods returned from Mahesh, Error rectification recording, ₹ 1,000 was recorded as ₹ 1,600)
600



600

Q7. Rectify the following errors:

(a) Sales book overcast by Rs 700.

(b) Purchases book overcast by Rs 500.

(c) Sales return book overcast by Rs 300.

(d) Purchase return book overcast by Rs 200.

Journal Recordings to rectify the errors

DateParticularsL.FDebit
Amount
Credit
Amount
iSales Account Dr.
To Suspense A/c
(Sales book overcast by ₹ 700, Error rectification recording)


700





700
iiSuspense Account Dr.
To Purchases A/c
(Purchases book overcast by ₹ 500, Error rectification recording)
500


500
iiiSuspense Account Dr.
To Sales Return A/c
(Sales Return book overcast by ₹ 300, Error rectification recording)
300


300
ivPurchases Return Account Dr.
To Suspense A/c
(Purchases return book overcast by ₹ 700, Error rectification recording)
200



200

Q8. Rectify the following errors and ascertain the amount of difference in trial balance by preparing suspense account:

(a) Credit sales to Mohan Rs 7,000 were posted as Rs 9,000.

(b) Credit purchases from Rohan Rs 9,000 were posted as Rs 6,000.

(c) Goods returned to Rakesh Rs 4,000 were posted as Rs 5,000.

(d) Goods returned from Mahesh Rs 1,000 were posted as Rs 3,000.

(e) Cash sales Rs 2,000 were posted as Rs 200.

Journal Recordings to rectify the errors

DateParticularsL.FDebit
Amount
Credit
Amount
iSuspense A/c Dr.
To Mohan’s A/c
(Credit Sales to Mohan, Error rectification recording, credit sales were posted as ₹ 9,000 instead of ₹ 7,000)
2,000



2,000

iiSuspense A/c Dr.
To Rohan’s A/c
(Credit Purchases from Mohan, Error rectification recording, Credit purchases were posted as ₹ 6,000 instead of ₹ 9,000)
3,000



3,000

iiiSuspense A/c Dr.
To Rakesh’s A/c
(Goods returned to Rakesh, Error rectification recording, Goods returned were recorded as ₹ 5,000 instead of ₹ 4,000)
1,000



1,000

ivMahesh’s A/c Dr.
To Suspense A/c
(Goods returned from Mahesh, Error rectification recording, Goods returned were posted as ₹ 3,000 instead of ₹ 1,000)
2,000



2,000

Suspense A/c Dr.
To Sales A/c(Cash Sales, Error rectification recording, Cash sales were posted as ₹ 200 instead of ₹ 2,000)
1,800


200

Suspense Account

Dr Cr

DateParticularsJ.F.Amount
DateParticularsJ.F.Amount
To Mohan’s A/c2,000By Mahesh’s A/c2,000
To Rohan’s A/c3,000By Balance c/d5,800
To Rakesh’s A/c1,000
To Sales A/c1,800
Total7,800Total7,800

Hence, the difference in trial balance is ₹5,800 excess debit.

Q9. Rectify the following errors:

(a) Credit sales to Mohan Rs 7,000 were posted to Karan.

(b) Credit purchases from Rohan Rs 9,000 were posted to Gobind.

(c) Goods returned to Rakesh Rs 4,000 were posted to Naresh.

(d) Goods returned from Mahesh Rs 1,000 were posted to Manish.

(e) Cash sales Rs 2,000 were posted to commission account.

Journal Recordings to rectify the errors

DateParticularsL.FDebit
Amount
Credit
Amount
iMohan’s A/c Dr.
To Karan A/c
(Credit sales to Mohan, Error rectification recording, erroneously recorded in Karan’s account)
7,000



7,000

iiGobind’s A/c Dr.
To Rohan’s A/c
(Credit purchases from Rohan, Error rectification recording, erroneously recorded in Gobind’s account)
9,000



9,000

iiiRakesh’s A/c Dr.
To Naresh’s A/c
(Goods returned to Rakesh, Error rectification recording, erroneously recorded in Naresh’s account)
4,000



4,000

Manish’s A/c Dr.
To Mahesh’s A/c(Goods returned from Mahesh, Error rectification recording, erroneously recorded in Manish’s account)
1,000


1,000
vCommission A/c Dr.
To Sales A/c
(Cash sales, Error rectification recording, erroneously recorded in commission account)
2,000


1,000

Q10. Rectify the following errors assuming that a suspense account was opened.

Ascertain the difference in trial balance.

(a) Credit sales to Mohan Rs 7,000 were posted to the credit of his account.

(b) Credit purchases from Rohan Rs 9,000 were posted to the debit of his account as Rs 6,000.

(c) Goods returned to Rakesh Rs 4,000 were posted to the credit of his account.

(d) Goods returned from Mahesh Rs 1,000 were posted to the debit of his account as Rs 2,000.

(e) Cash sales Rs 2,000 were posted to the debit of sales account as Rs 5,000.

Journal Recordings to rectify the errors

DateParticularsL.FDebit
Amount
Credit
Amount
iMohan’s A/c Dr.
To Suspense A/c(Credit Sales to Mohan, Error rectification recording, Mohan’s account ws credited with ₹ 7,000, instead of debiting)
14,000


14,000
iiSuspense A/c Dr.
To Rohan’s A/c
(Credit purchases from Rohan, Error rectification recording, Rohan’s account was debited with ₹ 6,000 instead of crediting 9,000 for cash purchases from him)
15,000




15,000

iiiRakesh’s A/c Dr.
To Suspense A/c
(Goods returned to Rakesh, Error rectification recording, Rakesh’s account was credited with ₹ 4,000 instead of debiting ₹ 4,000)
8,000



8,000

ivSuspense A/c Dr.
To Mahesh’s A/c
(Goods returned from Mahesh, Error rectification recording, Mahesh’s account was debited with ₹ 2,000 instead of crediting ₹ 1,000)
3,000




3,000


vSuspense A/c Dr.
To Sales A/c
(Cash, Error rectification recording, Sales account was debited with ₹ 5,000 instead of crediting with ₹ 2,000)
7,0007,000

Suspense Account

Dr Cr

DateParticularsJ.F.Amount
DateParticularsJ.F.Amount
To Rohan’s A/c15,000By Mohan’s A/c14,000
To Mahesh’s A/c3,000By Rakesh’s A/c8,000
To Sales A/c7,000By Balance c/d3,000
Total25,000Total25,000

Hence, the trial balance shows ₹ 3,000 excess debit.

Q11. Rectify the following errors assuming that a suspense account was opened.

Ascertain the difference in trial balance.

(a) Credit sales to Mohan Rs 7,000 were posted to Karan as Rs 5,000.

(b) Credit purchases from Rohan Rs 9,000 were posted to the debit of Gobind as Rs 10,000.

(c) Goods returned to Rakesh Rs 4,000 were posted to the credit of Naresh as Rs 3,000.

(d) Goods returned from Mahesh Rs 1,000 were posted to the debit of Manish as Rs 2,000.

(e) Cash sales Rs 2,000 were posted to commission account as Rs 200.

Journal Recordings to rectify the errors

DateParticularsL.FDebit
Amount
Credit
Amount
iMohan’s A/c Dr.
To Karan’s A/c
To Suspense A/c
(Credit Sales to Mohan, Error rectification recording, Credit sales to Mohan for ₹ 7,000 were posted to Karan as ₹ 5,000)
7,000



5,000
2,000

iiSuspense A/c Dr.
To Rohan’s A/c
To Gobind’s A/c
(Credit purchases from Rohan, Error rectification recording, Credit purchases from Rohan ₹ 9,000 were posted to the debit of Gobind as ₹ 10,000)
19,000





9,000
10,000


iiiRakesh’s A/c Dr.
Naresh’s A/c Dr.
To Suspense A/c
(Goods returned to Rakesh, Error rectification recording, Goods returned to Rakesh ₹ 4,000 were posted to the credit of Naresh as ₹ 3,000)
4,000
3,000



7,000
ivSuspense A/c Dr.
To Mahesh’s A/c
To Manish’s A/c
(Goods returned from Mahesh, Error rectification recording, Goods returned from Mahesh ₹ 1,000 were posted to the debit of Manish as ₹ 2,000)
3,000





1,000
2,000


vCommission A/c Dr.
Suspense A/c Dr.
To Sales A/c
(Cash sales, Error rectification recording, Cash sales ₹ 2,000 were posted to commission account as ₹ 200)
200
1,800


2,000

Suspense A/c

Dr Cr

DateParticularsJ.F.Amount
DateParticularsJ.F.Amount
To Rahan’s A/c9,000By Mohan’s A/c2,000
To Gobind’s A/c10,000By Rakesh’s A/c4,000
To Mahesh’s A/c1,000By Naresh’s A/c3,000
To Manish’s A/c2,000By Balance c/d14,800
To Sales A/c1,800
Total23,800Total23,800

Hence, the trial balance has a ₹14,800 excess credit.

Q12. Rectify the following errors assuming that suspense account was opened.

Ascertain the difference in trial balance.

(a) Credit sales to Mohan Rs 7,000 were recorded in Purchase Book. However, Mohan’s account was correctly debited.

(b) Credit purchases from Rohan Rs 9,000 were recorded in sales book. However, Rohan’s account was correctly credited.

(c) Goods returned to Rakesh Rs 4,000 were recorded in sales return book. However, Rakesh’s account was correctly debited.

(d) Goods returned from Mahesh Rs 1,000 were recorded through purchases return book. However, Mahesh’s account was correctly credited.

(e) Goods returned to Naresh Rs 2,000 were recorded through purchases book. However, Naresh’s account was correctly debited.

Journal Recordings to rectify the errors

DateParticularsL.FDebit
Amount
Credit
Amount
iSuspense A/c Dr.
To Sales A/c
To Purchases A/c(Credit Sales to Mohan, Error rectification recording, Credit Sales were recorded in purchase book)
14,000



7,000
7,000

iiPurchases A/c Dr.
Sales A/c Dr.
To Suspense A/c
(Credit purchases from Rohan, Error rectification recording, Credit purchases were recorded in sales book)
9,000
9,000



18,000
iiiSuspense A/c Dr.
To Purchases Return A/c
To Sales Return A/c
(Goods returned to Rakesh, Error rectification recording, Goods returned were recorded in sales return book)
8,000




4,000
4,000

ivSales Return A/c Dr.
Purchases Return A/c Dr.
To Suspense A/c
(Goods returned from Mahesh, Error rectification recording, Goods returned were recorded through purchases return book)

1,000
1,000







2,000



vSuspense A/c Dr.
To Purchases Return A/c
To Purchases A/c
(Goods returned to Naresh, Error rectification recording, Goods returned were recorded through purchases book)
4,000




2,000
2,000

Suspense Account

Dr Cr

DateParticularsJ.F.Amount
DateParticularsJ.F.Amount
To Sales A/c7,000By Purchases A/c9,000
To Purchases A/c7,000To Sales A/c9,000
To Purchases Return A/c4,000By Sales Return A/c1,000
To Sales Return A/c4,000By Purchases Return A/c1,000
To Purchases Return A/c2,000By Balance c/d6,000
To Purchases A/c2,000
Total26,000Total26,000

Hence, the trial balance is ₹6,000 excess credit

Q13. Rectify the following errors:

(a) Furniture purchased for Rs 10,000 wrongly debited to purchases account.

(b) Machinery purchased on credit from Raman for Rs 20,000 was recorded through purchases book.

(c) Repairs on machinery Rs 1,400 debited to machinery account.

(d) Repairs on overhauling of secondhand machinery purchased Rs 2,000 was debited to Repairs account.

(e) Sale of old machinery at book value of Rs 3,000 was credited to sales account.

Journal Recordings to rectify the errors

DateParticularsL.FDebit
Amount
Credit
Amount
iFurniture A/c Dr.
To Purchases A/c
(Furniture purchased, Error rectification recording, was wrongly debited to Purchases account)
10,000



10,000

iiMachinery A/c Dr.
To Purchases A/c
(Machinery purchased on credit, Error rectification recording, was wrongly debited to purchases account)
20,000



20,000
iiiRepairs on Machinery A/c Dr.
To Machinery A/c
(Repairs on machinery, Error rectification recording, was wrongly debited to machinery account)

1,400



1,400
ivMachinery A/c Dr.
To Repairs A/c
(Repairs on overhauling of second hand machinery purchased, Error rectification recording, was wrongly debited to repairs account)
2,000





2,000



Sales A/c Dr.
To Machinery A/c
(Sale of old machinery on book value, Error rectification recording, was wrongly credited to sales account)
3,000



3,000

Q14. Rectify the following errors assuming that suspension account was opened.

Ascertain the difference in trial balance.

(a) Furniture purchased for Rs 10,000 wrongly debited to purchase account as Rs 4,000.

(b) Machinery purchased on credit from Raman for Rs 20,000 recorded through Purchases Book as Rs 6,000.

(c) Repairs on machinery Rs 1,400 debited to Machinery account as Rs 2,400.

(d) Repairs on overhauling of second hand machinery purchased Rs 2,000 was debited to Repairs account as Rs 200.

(e) Sale of old machinery at book value Rs 3,000 was credited to sales account as Rs 5,000.

Journal Recordings to rectify the errors

DateParticularsL.FDebit
Amount
Credit
Amount
iFurniture A/c Dr.
To Purchases A/c
To Suspense A/c
(Furniture purchased, Error rectification recording, Furniture purchased for ₹ 10,000 was wrongly debited to purchases account as ₹ 4,000)

10,000







4,000
6,000



iiMachinery A/c Dr.
To Purchases A/c
To Raman’s A/c
(Machinery purchased, Error rectification recording, Machinery purchased on credit from Raman for ₹ 20,000 was recorded through purchases book as ₹ 6,000)
20,000





6,000
14,000


iiiRepairs A/c Dr.
Suspense A/c Dr.
To Machinery A/c
(Repairs on machinery, Error rectification recording, Repairs on machinery ₹ 1,400 was debited to machinery account as ₹ 2,400)
1,400
1,000



2,400
ivMachinery A/c Dr.
To Repairs A/c
To Suspense A/c
(Repairs on overhauling of second hand machinery purchased, error rectification entry, Repairs account was wrongly debited with ₹ 200 instead of crediting the machinery account with ₹ 2,000)
2,000







200
1,800




vSales A/c Dr.
To Machinery A/c
To Suspense A/c
(Sale of old machinery at book value, error rectification entry, Sale of old machinery on book value was credited to sales account instead of crediting the machinery account.)
5,000





3,000
2,000


Suspense Account

Dr Cr

DateParticularsJ.F.Amount
DateParticularsJ.F.Amount
To Machinery A/c1,000By Furniture A/c6,000
To Balance c/d8,800By Machinery A/c1,800
By Sales A/c2,000
Total9,800Total9,800

Hence, the trial balance has a ₹ 8,800 excess credit.

15. Rectify the following errors:

(a) Depreciation provided on machinery Rs 4,000 was posted as Rs 400.

(b) Bad debts written off Rs 5,000 were posted as Rs 6,000.

(c) Discount allowed to a debtor Rs 100 on receiving cash from him was posted as Rs 60.

(d) Goods withdrawn by proprietor for personal use Rs 800 were posted as Rs 300.

(e) Bill receivable for Rs 2,000 received from a debtor was posted as Rs 3,000.

Journal Recordings to rectify the errors

DateParticularsL.FDebit
Amount
Credit
Amount
iDepreciation A/c Dr.
To Machinery A/c
(Depreciation provided on machinery, Error rectification recording, was wrongly posted as ₹ 400 instead of ₹ 4,000)
3,600



3,600


iiDebtors A/c Dr.
To Bad Debts A/c
(Bad debts written off, Error rectification recording, was posted as ₹ 6,000 instead of ₹ 5,000)
1,000



1,000

iiiDiscount Allowed A/c Dr.
To Debtors A/c
(Discount allowed to debtors, Error rectification recording, was wrongly posted as ₹ 60 instead of ₹ 100)
40



40

ivDrawings A/c Dr.
To Purchases A/c
(Goods withdrawn by proprietor for personal use, Error rectification recording, was wrongly posted as ₹ 300 instead of ₹ 800)
500



500

vDebtor A/c Dr.
To Purchases A/c
(Bills receivable from debtors, Error rectification recording, was wrongly posted as ₹ 3,000 instead of ₹ 2,000)
1,000



1,000

Q16. Rectify the following errors assuming that suspense account was opened.

Ascertain the difference in trial balance.

(a) Depreciation provided on machinery Rs 4,000 was not posted to Depreciation account.

(b) Bad debts written-off Rs 5,000 were not posted to Debtors account.

(c) Discount allowed to a debtor Rs 100 on receiving cash from him was not posted to discount allowed account.

(d) Goods withdrawn by proprietor for personal use Rs 800 were not posted to Drawings account.

(e) Bill receivable for Rs 2,000 received from a debtor was not posted to Bills receivable account.

Journal Recordings to rectify the errors

DateParticularsL.FDebit
Amount
Credit
Amount
iDepreciation A/c Dr.
To Suspense A/c
(Depreciation provided on machinery, Error rectification recording, was not posted to discount account)
4,000




4,000


iiSuspense A/c Dr.
To Debtors A/c
(Bad debts written-off, Error rectification recording, were not posted to debtors account)
5,000




5,000


iiiDiscount Allowed A/c Dr.
To Suspense A/c
(Discount allowed to a debtor after receiving cash, Error rectification recording, was not posted to discount allowed account)
100



100

ivDrawings A/c Dr.
To Suspense A/c
(Goods withdrawn by proprietor for personal use, Error rectification recording, was not posted to drawings account)
800



800

vBills Receivable A/c Dr.
To Suspense A/c
(Bills receivable from a debtor, Error rectification recording, was not posted to Bills receivable account)
2,000



2,000

Suspense Account

Dr Cr

DateParticularsJ.F.Amount
DateParticularsJ.F.Amount
To Debtors A/c5,000By Depreciation A/c4,000
To Balance b/d1,900By Discount Allowed A/c100
By Drawings A/c800
By Bills Receivable A/c2,000
Total6,900Total6,900

Hence, difference in trial balance is ₹1,900 excess credit.

Q17. Trial balance of Anuj did not agree. It showed an excess credit of Rs 6,000.

He put the difference to suspense account. He discovered the following errors.

(a) Cash received from Ravish Rs 8,000 posted to his account as Rs 6,000.

(b) Returns inwards book overcast by Rs 1,000.

(c) Total of sales book Rs 10,000 was not posted to Sales account.

(d) Credit purchases from Nanak Rs 7,000 were recorded in sales Book. However, Nanak’s account was correctly credited.

(e) Machinery purchased for Rs 10,000 was posted to purchases account as Rs 5,000. Rectify the errors and prepare suspense account.

Journal Recordings to rectify the errors

DateParticularsL.FDebit
Amount
Credit
Amount
iSuspense A/c Dr.
To Ravish A/c
(Cash received from Ravish, Error rectification recording, was wrongly posted as ₹ 6,000 instead of ₹ 8,000)
2,000



2,000

iiSuspense A/c Dr.
To Return Inward A/c
(Returns inwards book was overcast by ₹ 1,000, Error rectification recording)
1,000


1,000
iiiSuspense A/c Dr.
To Sales A/c
(Total of sales book, Error rectification recording, was not posted to sales account earlier)
10,000


10,000
ivPurchases A/c Dr.
Sales A/c Dr.
To Suspense A/c
(Credit purchases from Nanak, Error rectification recording, was recorded in sales book)
7,000
7,000



14,000
vPurchases A/c Dr.
To Purchases A/c
To Suspense A/c
(Machinery purchased for ₹ 10,000, Error rectification recording, was posted to purchases account as ₹ 5,000)
10,000




5,000
5,000

Suspense Account

Dr Cr

DateParticularsJ.F.Amount
DateParticularsJ.F.Amount
To Balance c/d6,000By Purchases A/c7,000
To Ravish A/c2,000By Sales A/c7,000
To Return Inwards A/c1,000By Machinery A/c5,000
To Sales A/c10,000
Total19,000Total19,000

Hence, total of suspense account is ₹ 19,000

Q18. Trial balance of Madan did not agree and he put the difference to suspense account. He discovered the following errors:

(a) Sales return book overcast by Rs 800.

(b) Purchases return to Sahu Rs 2,000 were not posted.

(c) Goods purchased on credit from Narula Rs 4,000 though taken into stock, but no entry was passed in the books.

(d) Installation charges on new machinery purchased Rs 500 were debited to sundry expenses account as Rs 50.

(e) Rent paid for residential accommodation of madam (the proprietor) Rs 1,400 was debited to rent account as Rs 1,000.

Rectify the errors and prepare suspense account to ascertain the difference in trial balance. 

Journal Recordings to rectify the errors

DateParticularsL.FDebit
Amount
Credit
Amount
iSuspense A/c Dr.
To Sales Return A/c
(Sales return, Error rectification recording, Sales return book was overcast by ₹ 800)
800



800

iiSahu’s A/c Dr.
To Purchases Return A/c
(Purchases return to Sahu, Error rectification recording, was not recorded earlier)
2,000


2,000
iiiPurchases A/c Dr.
To Narula’s A/c
(Goods purchased on credit from Narula, Error rectification recording, was not recorded earlier)
4,000



4,000

ivMachinery A/c Dr.
To Sundry Expenses A/c
To Suspense A/c
(Installation charges on new machinery purchased, Error rectification recording, Earlier Sundry expenses account was debited with ₹ 50 instead of crediting the machinery account with ₹ 500)
500






50
450



vDrawings A/c Dr.
To Rent A/c
To Suspense A/c
(Drawings by the proprietor for paying the personal rent, Error rectification recording, Earlier Rent account was debited with ₹ 1,000 instead of debiting the drawings account with ₹ 1,400)
1,400






1,000
400



Suspense Account

Dr Cr

DateParticularsJ.F.Amount
DateParticularsJ.F.Amount
To Sales Return A/c800By Machinery A/c450
To Balance c/d50By Drawings A/c400
Total850Total850

The credit balance is ₹50 as per the question.

As per textbook the answer is ₹2050, therefore the entry (b) is added to suspense account and the resulting amount is ₹2050.

Q19. Give journal entries to rectify the following errors assuming that suspense account had been opened.

(a) Goods distributed as free sample Rs 5,000 were not recorded in the books.

(b) Goods withdrawn for personal use by the proprietor Rs 2,000 were not recorded in the books.

(c) Bill receivable received from a debtor Rs 6,000 was not posted to his account.

(d) Total of Returns inwards book Rs 1,200 was posted to Returns outwards account.

(e) Discount allowed to Reema Rs 700 on receiving cash from her was recorded in the books as Rs 70

Journal Recordings to rectify the errors

DateParticularsL.FDebit
Amount
Credit
Amount
iMarketing A/c Dr.
To Purchases A/c
(Goods distributed as free sample, Error rectification recording, was not recorded earlier)
5,000



5,000
iiDrawings A/c Dr.
To Purchases A/c
(Goods withdrawn for personal use by the proprietor, Error rectification recording, was not recorded earlier)
2,000



2,000

iiiSuspense A/c Dr.
To Debtors A/c
(Bills receivable received from the debtor, Error rectification recording, was not posted to the debtors account)
6,000



6,000

ivReturns Inward A/c Dr.
Returns Outward A/c Dr.
To Suspense A/c
(Total of returns inwards book, Error rectification recording, was posted to returns outwards account)
1,200
1,200



2,400
vDiscount allowed A/c Dr.
To Reema’s A/c
(Discount allowed on receiving cash, Error rectification recording, was wrongly recorded earlier as ₹ 70 instead of ₹ 700)
630



630

Suspense Account

Dr Cr

DateParticularsJ.F.Amount
DateParticularsJ.F.Amount
To Debtors A/c6,000By Returns Inward A/c1,200
By Returns Outward A/c1,200
By Balance c/d3,600
Total6,000Total6,000

Hence, the difference in trial balance is ₹3,600 excess debit.

Q20. Trial balance of Khatau did not agree. He put the difference to suspense account and discovered the following errors:

(a) Credit sales to Manas Rs 16,000 were recorded in the purchases book as Rs 10,000 and posted to the debit of Manas as Rs 1,000.

(b) Furniture purchased from Noor Rs 6,000 was recorded through purchases book as Rs 5,000 and posted to the debit of Noor Rs 2,000.

(c) Goods returned to Rai Rs 3,000 recorded through the Sales book as Rs 1,000.

(d) Old machinery sold for Rs 2,000 to Maneesh recorded through sales book as Rs 1,800 and posted to the credit of Manish as Rs 1,200.

(e) Total of Returns inwards book Rs 2,800 posted to Purchase account.

Rectify the above errors and prepare suspense account to ascertain the difference in trial balance.

Journal Recordings to rectify the errors

DateParticularsL.FDebit
Amount
Credit
Amount
iManas’s A/c Dr.
Suspense A/c Dr.
To Purchases A/c
To Sales A/c
(Credit sales for ₹ 16,000, Error rectification recording, was wrongly recorded as ₹ 10,000 in the purchases book and posted to the debit of Manas as ₹ 1,000)
15,000
11,000






10,000
16,000


iiFurniture A/c Dr.
Suspense A/c Dr.
To Noor’s A/c
To Purchases A/c
(Furniture purchased from Noor for ₹ 6,000, Error rectification recording, was recorded through purchases book as ₹ 5,000 and posted to the debit of Noor as ₹ 2,000)
6,000
7,000






8,000
5,000



iiiSales A/c Dr.
Rai’s A/c Dr.
To Returns Outward A/c
(Goods returned, Error Rectification Entry, was wrongly recorded through the sales book as ₹ 1,000 instead of ₹ 3,000)
1,000
2,000




3,000

ivManish’s A/c Dr.
Sales A/c Dr.
Maneesh’s A/c Dr.
To Machinery A/c
To Suspense A/c
(Old machinery sold to Maneesh for ₹ 2,000, Error Rectification Entry, was wrongly recorded through sales book as ₹ 1,800 and posted to Manish’s account as ₹ 1,200)
1,200
1,800
2,000






2,000
3,000

vReturn Inward A/c Dr.
To Purchases A/c
(Total of returns inwards book, Error Rectification Entry, was wrongly posted to purchases account)
2,800



2,800

Suspense Account

Dr Cr

DateParticularsJ.F.Amount
DateParticularsJ.F.Amount
To Sales A/c11,000By Manish’s A/c3,000
To Noor’s A/c7,000By Balance c/d15,000
Total18,000Total18,000

Hence, the trial balance is Rs 15,000 excess debit

Concepts covered in this chapter

  • Meaning of Trial Balance
  • Objectives of Preparing the Trial Balance
  • To Ascertain the Arithmetical Accuracy of Ledger Accounts
  • To Help in Locating Errors
  • To Help in the preparation of the Financial Statements
  • Preparation of Trial Balance
  • Totals method
  • Balances Method
  • Totals-cum-balances Method
  • Significance of Agreement of Trial Balance
  • Classification of Errors
  • Errors of Commission

FAQ:

1. What is Trial balance?

Trial balance is the list of all debit and credit balances of accounts taken out from the ledger at a given period.

2. Write The principles of preparation of trial balance.

The principle of preparation of trial balance is debit entry have automatic
credit on some other account.

3. What is suspense a/c?

It is a temporary a/c in which the difference in Trial balance is placed and is
wiped off when the errors are locked

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