Rectify the following errors assuming that suspense account was opened. Ascertain the difference in trial balance. (a) Depreciation provided on machinery ₹ 4,000 was not posted to Depreciation account. (b) Bad debts written-off ₹ 5,000 were not posted to Debtors account. (c) Discount allowed to a debtor ₹ 100 on receiving cash from him was not posted to discount allowed account. (d) Goods withdrawn by proprietor for personal use ₹ 800 were not posted to Drawings account. (e) Bill receivable for ₹ 2,000 received from a debtor was not posted to Bills receivable account.

> [!TLDR] > Each posting to the *named* account was omitted, unbalancing the trial balance. We supply the missing side against Suspense; netting the Suspense postings shows the trial balance was over on the credit side by **₹1,900**. **Treatment.** Where a *debit* posting was omitted (Depreciation, Discount Allowed, Drawings, Bills Receivable), we debit that account and credit Suspense. Where a *credit* posting was omitted — (b) the debtors were not credited — we credit Debtors and debit Suspense. **Rectifying Journal Entries** | Date | Particulars | L.F. | Debit (₹) | Credit (₹) | |---|---|---|---|---| | (a) | Depreciation A/c ..............................Dr | | 4,000 | | | | To Suspense A/c | | | 4,000 | | | *(Depreciation not posted to Depreciation A/c)* | | | | | (b) | Suspense A/c ..............................Dr | | 5,000 | | | | To Sundry Debtors A/c | | | 5,000 | | | *(Bad debts not posted to Debtors A/c)* | | | | | (c) | Discount Allowed A/c ..............................Dr | | 100 | | | | To Suspense A/c | | | 100 | | | *(Discount allowed not posted to Discount Allowed A/c)* | | | | | (d) | Drawings A/c ..............................Dr | | 800 | | | | To Suspense A/c | | | 800 | | | *(Goods withdrawn not posted to Drawings A/c)* | | | | | (e) | Bills Receivable A/c ..............................Dr | | 2,000 | | | | To Suspense A/c | | | 2,000 | | | *(Bill receivable not posted to Bills Receivable A/c)* | | | | **Suspense Account** | Particulars | Amount (₹) | Particulars | Amount (₹) | |---|---|---|---| | To Sundry Debtors A/c (b) | 5,000 | By Difference in Trial Balance | 1,900 | | | | By Depreciation A/c (a) | 4,000 | | | | By Discount Allowed A/c (c) | 100 | | | | By Drawings A/c (d) | 800 | | | | By Bills Receivable A/c (e) | 2,000 | | **Total** | **6,900... (see note)** | **Total** | **6,900** | …

Rectify the following errors assuming that suspense account was opened. Ascertain the difference in trial bala

Numerical Questions · Q18

Q. Rectify the following errors assuming that suspense account was opened. Ascertain the difference in trial balance.

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

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

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

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

CBSENCERTSubjective· 5mImportance★★★★★est

86% · 42/49 Questions

🔒 Locked · start free trial →

You're viewing a preview — the full solution, concept, methods & PYQ mapping are locked.

Start your 14-day free trial to unlock the full solution →

Concept understanding — Error Rectification

Error Rectification in Accountancy

The Everyday Intuition

Think of a diary where you record your daily expenses. One day you write "bought a book for ₹200" but later realise you actually spent ₹200 on a pen, not a book. Or you write ₹2000 instead of ₹200. Or you forget to write the entry altogether. What do you do? You don't tear out the page. You make a correction — neatly, with a note, so the record stays honest and clear.

That's exactly what error rectification is in accounting. Mistakes happen in books of accounts — wrong amounts, wrong accounts, wrong sides, or entries that were never made. The process of correcting these mistakes is called error rectification.

The Precise Meaning

An error in accounting is any mistake that causes the trial balance to disagree (or, in some cases, even if the trial balance agrees, the accounts are still wrong). Rectification means passing a rectifying journal entry (or, in some cases, making a simple adjustment in the ledger) to set the record straight.

Errors are broadly of two types:

Errors that affect the trial balance — the debit and credit totals don't match. These are usually one-sided mistakes (e.g., posting only the debit side of an entry).
Errors that do not affect the trial balance — the trial balance still tallies, but the accounts are wrong. These include:
- Error of omission (entry not recorded at all)
- Error of commission (wrong amount, wrong account, wrong side)
- Error of principle (e.g., treating a capital expense as revenue)
- Compensating errors (two mistakes that cancel each other out)

Important

The golden rule: If the trial balance disagrees, the error is located and corrected by a journal entry. If the trial balance agrees but the accounts are wrong, a rectifying journal entry is still needed — but the suspense account is not involved.

Why It Matters

A business's financial statements — the Profit & Loss Account and the Balance Sheet — are built from the trial balance. If errors remain, the profit figure is wrong, assets and liabilities are misstated, and the business makes decisions based on false numbers. Tax authorities, banks, and investors rely on these statements. Error rectification ensures that the accounts present a true and fair view.

Accounting Treatment: The Mechanics

The correction is always done through a journal entry (except for very minor posting errors that can be corrected by a ledger adjustment). The logic is simple:

If an account was debited when it should have been credited, you reverse the wrong debit and then put the correct credit.
If an amount was too small, you add the difference.
If an amount was too large, you subtract the difference.
If an entry was completely missed, you pass the correct entry now.

Example 1: Error of Commission (Wrong Account)

Scenario: Goods sold to Ram for ₹5,000 were correctly recorded in the Sales Book but posted to Shyam's account instead of Ram's account.

Effect: Ram's account is understated (no debit), Shyam's account is overstated (wrong debit). Sales is correct.

Rectification Entry:

Particulars	Debit (₹)	Credit (₹)
Ram's A/c Dr.	5,000
To Shyam's A/c		5,000
(Being correction of wrong posting — Ram debited instead of Shyam)

Example 2: Error of Omission

Scenario: Credit sales to Mohan for ₹10,000 were not recorded at all.

Effect: Mohan's account (debtor) is missing, Sales is missing. Trial balance still tallies (both sides missed equally), but accounts are wrong.

Rectification Entry:

Particulars	Debit (₹)	Credit (₹)
Mohan's A/c Dr.	10,000
To Sales A/c		10,000
(Being credit sales to Mohan now recorded)

Example 3: Error of Principle

Scenario: Purchase of machinery for ₹50,000 was debited to Purchases A/c instead of Machinery A/c.

Effect: Purchases (revenue expense) is overstated; Machinery (fixed asset) is understated. Profit is understated.

Rectification Entry:

Particulars	Debit (₹)	Credit (₹)
Machinery A/c Dr.	50,000
To Purchases A/c		50,000
(Being correction — capital expenditure wrongly treated as revenue)

Example 4: Error Affecting Trial Balance (Suspense Account)

Scenario: Sales of ₹8,000 were correctly recorded in the Sales Book but posted to the credit side of Sales A/c as ₹800 (short by ₹7,200).

Effect: Credit side of Sales A/c is short by ₹7,200. Trial balance will not tally — debit side exceeds credit by ₹7,200. A Suspense A/c is opened with a credit balance of ₹7,200 to make the trial balance tally temporarily.

Rectification Entry:

Particulars	Debit (₹)	Credit (₹)
Suspense A/c Dr.	7,200
To Sales A/c		7,200
(Being short posting of sales corrected — ₹800 posted instead of ₹8,000)

Start your 14-day free trial to unlock the full solution →

Each item names the exact account whose posting was omitted, so all are one-sided errors rectified through Suspense.

Ref	Rectifying entry	Debit (₹)	Credit (₹)	Suspense
(a)	Depreciation A/c Dr — To Suspense A/c	4,000	4,000	Cr 4,000
(b)	Suspense A/c Dr — To Sundry Debtors A/c	5,000	5,000	Dr 5,000
(c)	Discount Allowed A/c Dr — To Suspense A/c	100	100	Cr 100
(d)	Drawings A/c Dr — To Suspense A/c	800	800	Cr 800
(e)	Bills Receivable A/c Dr — To Suspense A/c	2,000	2,000	Cr 2,000

Start your 14-day free trial to unlock the full solution →

Each posting to the named account was omitted, unbalancing the trial balance. We supply the missing side against Suspense; netting the Suspense postings shows the trial balance was over on the credit side by ₹1,900.

Treatment. Where a debit posting was omitted (Depreciation, Discount Allowed, Drawings, Bills Receivable), we debit that account and credit Suspense. Where a credit posting was omitted — (b) the debtors were not credited — we credit Debtors and debit Suspense.

Rectifying Journal Entries

Date	Particulars	Debit (₹)	Credit (₹)
(a)	Depreciation A/c ..............................Dr	4,000
	To Suspense A/c		4,000
	(Depreciation not posted to Depreciation A/c)
(b)	Suspense A/c ..............................Dr	5,000
	To Sundry Debtors A/c		5,000
	(Bad debts not posted to Debtors A/c)
(c)	Discount Allowed A/c ..............................Dr	100
	To Suspense A/c		100
	(Discount allowed not posted to Discount Allowed A/c)
(d)	Drawings A/c ..............................Dr	800
	To Suspense A/c		800
	(Goods withdrawn not posted to Drawings A/c)
(e)	Bills Receivable A/c ..............................Dr	2,000
	To Suspense A/c		2,000
	(Bill receivable not posted to Bills Receivable A/c)

Suspense Account

Particulars	Amount (₹)	Particulars	Amount (₹)
To Sundry Debtors A/c (b)	5,000	By Difference in Trial Balance	1,900
		By Depreciation A/c (a)	4,000
		By Discount Allowed A/c (c)	100
		By Drawings A/c (d)	800
		By Bills Receivable A/c (e)	2,000
Total	6,900... (see note)	Total	6,900

Start your 14-day free trial to unlock the full solution →

Same / Similar Concept — real previous-year questions on the same or a closely similar concept, not this exact question.

CBSE 2026Set ANNUAL1 mark
$Q. Fill in the blank: Double side errors cannot be affect ________.$
›Reveal solutionSolution

Answer: The trial balance.

Double-sided (two-sided) errors - such as errors of omission, principle and compensating errors - affect two accounts equally on both sides, so the trial balance still agrees. …

Start your 14-day free trial to see the full solution →
CBSE 2025Set ANNUAL1 mark
$Q. Answer in one word/sentence: What is called the errors which cancel the effect of each other out?$
›Reveal solutionSolution

Answer: Compensating errors.

Compensating errors are two or more errors that cancel out each other's effect, so the trial balance still …

Start your 14-day free trial to see the full solution →
CBSE 2025Set ANNUAL1 mark
$Q. Answer in one word/sentence: Which errors are detected by the Trial balance?$
›Reveal solutionSolution

Answer: Errors that disturb the agreement (one-sided errors of commission).

A trial balance detects only those errors that make the two sides unequal - chiefly one-sided errors: wrong totalling (casting), posting a wrong amount, or posting to the wrong side. It cannot detect errors of omission, principle or compensating erro …

Start your 14-day free trial to see the full solution →
CBSE 2024Set MARCH1 markMCQ
$Q. Wrong balancing of account is ________ .$
(a) Error of Commission
(b) Error of Omission
(c) Error of Principle
(d) Compensating Error
›Reveal solutionSolution

Wrong balancing of an account is an Error of Commission. Correct option: (a) Error of Commission.

Errors of commission are clerical errors committed while recording, posting, casting (totalling) or balancing accounts — for example, wrong totalling, wrong balancing, posting a wrong amount, or posting to the wrong side. Since “wrong balancing of account” is a mistake in computing the balance of a ledger account, it is a classic error of commission.

…

Start your 14-day free trial to see the full solution →
CBSE 2023Set MARCH1 markMCQ
$Q. These type of errors affect the agreement of Trial Balance.$
(a) Error of complete omission
(b) Error of principle
(c) Compensating errors
(d) Error of partial omission
›Reveal solutionSolution
The error that affects the agreement of the trial balance is error of partial omission — option (d).

From the Kerala Plus One (DHSE) Accountancy chapter Trial Balance and Rectification of Errors:

Errors are of two broad kinds:

Errors that do NOT affect the trial balance (both debit and credit are equally wrong or both are missing): error of complete omission (the whole entry is left out), error of principle (wrong classification, but debit = credit), and compensating errors (two or more errors that cancel out). …
Start your 14-day free trial to see the full solution →
CBSE 2022Set MARCH1 markMCQ
$Q. Which of the following is an error of commission?$
(a) Wages paid for installation of machinery debited to wages account
(b) Purchased goods for cash not recorded in cash book
(c) Wrong balancing of Furniture account
(d) Sale of fixed assets credited to sales account
›Reveal solutionSolution
Wrong balancing of Furniture account is an error of commission — option (c). Kerala Plus One (DHSE) Accountancy, Trial Balance and Rectification of Errors.

An error of commission is a clerical error made in recording, posting, totalling (casting) or balancing, where the right account is used but the mechanics go wrong (wrong amount, wrong side, wrong casting, wrong balancing).

Examining each option:

(a) Wages paid for installation of machinery debited to Wages A/c — a capital expenditure treated as revenue expenditure = error of principle.

(b) Purchase of goods for cash not recorded at all — a transaction completely left out = error of omission. …
Start your 14-day free trial to see the full solution →
CBSE 2020Set MARCH1 markMCQ
$Q. If the trial balance agrees, it implies that,$
(a) a) There is no error in the books.
(b) b) There may be two sided errors in the books.
(c) c) There may be one sided error in the books.
(d) d) There may be both two sided and one sided errors in the books.
›Reveal solutionSolution

Correct option: (b). Agreement of the trial balance does not prove the books are error-free; only two-sided (equal-effect) errors can still be present.

A trial balance agrees when the total of debit balances equals the total of credit balances. This proves only arithmetical accuracy. Errors that affect two accounts equally on both sides — errors of complete omission, errors of principle and compensating errors — do not disturb this equal …

Start your 14-day free trial to see the full solution →
CBSE 2018Set ANNUAL1 mark
$Q. What do you mean by compensating error? Or What is Suspense A/c?$
›Reveal solutionSolution

A compensating error is one offset by another error of equal and opposite effect; a Suspense A/c temporarily balances a disagreeing Trial Balance.

Compensating error: This occurs when the effect of one error is exactly neutralised by one or more other errors of an equal amount in the opposite direction. Because the excess debit of one error is cancelled by an equal excess credit of another, the Trial Balance continues to agree and the error is not easily detected. Example: Ram's account over-debited by Rs 500 and Shyam's account over-credited by Rs 500.

…

Start your 14-day free trial to see the full solution →
CBSE 2018Set ANNUAL1 mark
$Q. Why is Rectification of Error necessary?$
›Reveal solutionSolution
Rectification of errors is necessary so that the accounts, profit/loss and Balance Sheet give a true and fair view.

If errors are left uncorrected, the ledger balances will be wrong, which in turn distorts the Trial Balance, the computed profit or loss, and the Balance Sheet. Rectification of errors is therefore necessary:

To show the correct balances of all affected accounts.

To arrive at the correct amount of profit or loss for the period.

To present a true and fair view of the financial position in the Balance Sheet. …
Start your 14-day free trial to see the full solution →

←Previous question · questions-for-practiceQ17 — Rectify the following errors : (a) Depreciation provided on machinery …→Next question · questions-for-practiceQ19 — Trial balance of Anuj did not agree. It showed an excess credit of ₹ 6…

Q.Rectify the following errors assuming that suspense account was opened. Ascertain the difference in trial balance.

🎓Unlock everything free for 14 days

Unlock everything free for 14 days