If the credit side of a trial balance exceeds the debit side before rectification, what balance will the suspense account normally show?
Correct answer: B. A debit balance equal to the difference
- A. A credit balance equal to the difference
- B. A debit balance equal to the difference
- C. A nil balance before rectification
- D. A balance equal to total capital
Explanation
When credits exceed debits, the debit side is short by the difference. Suspense is placed on the shorter debit side, so it shows a debit balance until the errors are corrected.
Report an error
The more specific you are, the faster it gets fixed. A source beats an opinion.
Prefer email? support@testustad.com
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.
Practise Correction of Errors and Suspense Accounts
34 free Correction of Errors and Suspense Accounts MCQs from Accounting, each with the correct answer and an explanation. Unlimited attempts, no account needed.
Exams that ask Accounting questions like this
Accounting is on 3 papers prepared for on TestUstad, and all of them draw the same bank, so this question is worth knowing for every one of them.
More Correction of Errors and Suspense Accounts questions
Two independent errors cancel each other so that the trial balance agrees. What are these errors called?
A machine purchased for business use is debited to the Purchases Account instead of the Machinery Account. What type of error is this?
The purchases book is undercast by Rs. 4,000. Which entry rectifies the error?
A payment of Rs. 7,500 to a creditor is correctly posted to the creditor's account but is omitted from the Cash Account. Which entry rectifies the error?
Goods sold for Rs. 9,000 are entered in the sales book as Rs. 900. What is the effect on the trial balance?
The proceeds from selling an old office vehicle are credited to Sales Account instead of the Vehicle Account. Which statement is correct?