Goods sold for Rs. 9,000 are entered in the sales book as Rs. 900. What is the effect on the trial balance?
Correct answer: C. The trial balance remains in agreement
- A. The debit total exceeds the credit total by Rs. 8,100
- B. The credit total exceeds the debit total by Rs. 8,100
- C. The trial balance remains in agreement
- D. The suspense account shows a debit of Rs. 9,000
Explanation
The incorrect amount is posted to both the customer's account and the Sales Account. Although both accounts are understated by Rs. 8,100, the two sides remain equal, so the trial balance agrees.
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About Correction of Errors and Suspense Accounts
Accounting errors are corrected by journal entries after identifying whether the mistake affects one account or both sides of double entry. Suspense accounts temporarily hold an unexplained trial balance difference and must be cleared, while errors of omission, commission, principle, original entry and reversal require different corrections.
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