Trial Balance Test

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Trial Balance Test - 4

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Weekly Quiz Competition

Question 1
1 / -0

Which of the following error will disturb the balancing of trial balance

A
Adding up the returns inwards journal as Rs.11400 instead of Rs.12600

B
Recording in the purchase journal an invoice for acquiring a non current assets for Rs.60000

C
Failing to record a purchase invoice for Rs.54000 in the purchase journal

D
Recording a sales invoice for Rs.65000 in the sales journal

Solution

Because it is a one sided error and trial balance is affected only by one sided errors.
Question 2
1 / -0

A sale to Chetan for Rs.21, 400 has been posted to the customer's account as Rs.24,100. The trial balance failed to balance but the difference has not been placed in a Suspense account. The journal entry to correct this error would require which of the following

A
Debit sales account and credit Chetan’s account with Rs.2700

B
Debit Chetan's account with Rs.2,700

C
Credit Chetan's account with Rs.2,700

D
Debit Suspense account and credit Chetan's account with Rs.2,700

Solution

Chetan's account has been debited in excess by 2700. So it will now be credited with the same amount. Suspense account will not be debited because the difference has not been transferred to suspense account.
Question 3
1 / -0

Raj Hans Traders paid Rs.25,000 to Preetpal Traders (a supplier of goods). This transaction was correctly recorded in the cashbook. But while posting to the ledger, Preetpal’s account was debited with Rs.2,500 only. This constitutes an error of

A
Commission

B
Principle

C
Omission

D
Compensating

Solution

Errors which are committed due to wrong posting of transactions, wrong totalling or balancing of the accounts, wrong casting of the subsidiary books, or wrong recording of amount in the books of original entry, etc constitute errors of commission.
Question 4
1 / -0

A trial balance is prepared to know:

A
Debit Balance

B
Balance of Suspense Account

C
Credit Balance

D
Whether both sides are equal or not

Solution

Trial balance is prepared to check the arithmetical accuracy of posting into the ledger accounts. If there are errors in posting, the totals of the two sides will not be equal.
Question 5
1 / -0

Credit sales to Mohan Rs.10,000 had been duly recorded in the sales book but the posting from sales book to Mohan’s account has not been made, it would be an error of

A
Principle

B
Complete omission

C
partial omission

D
Compensating

Solution

The recording of transaction has been partly omitted from the books, it is therfore an error of partial omission.
Question 6
1 / -0

If a credit purchase of machinery is recorded in purchases book instead of journal proper it is an error of

A
Compensating Errors

B
Errors of Commission

C
Error of principle

D
Errors of Omission

Solution

Treating capital expenditure as revenue expenditure is an error of principle. Purchase journal is used for recording credit purchases of goods and not the assets.
Question 7
1 / -0

If purchases book has been overcast by Rs.10,000 resulting in excess debit of Rs.10,000 in purchases account and sales returns book is undercast by Rs.10,000 resulting in short debit to sales returns account, it is an example of which type of error?

A
compensating errors

B
Error of principle

C
Errors of Omission

D
Errors of Commission

Solution

Since one account has been debited in excess and one has been debited short, the two errors will neutralize each other.
Question 8
1 / -0

Which of the following will not affect the trial balance

A
Instead of debiting the account, it has been credited by mistake.

B
goods returned to supplier not recorded

C
Instead of posting on the debit side, amount has been posted on the credit side

D
Not posted in subsidiary accounts, accounts are not opened in the ledger

Solution

It will not affect the trial balance because it is a two sided error.

Question 9

1 / -0

Match the following. Options are as follows:

a. Error of Omission	i. Creditors A/c has been balanced short by Rs.500, then Trial Balance will Rs.500 short in credit side
b. Error of Commission	ii. Goods sold to X on credit but not recorded in sales book
c. Errors of Principles	iii. On July, 1st 2011 a sum of Rs.2,000 paid to Mohit is posted as Rs.200 to the Debit of his A/c and on July 20th, 2011 a sum of Rs.200 paid to sonil has been posted as Rs.2,000 to the Debit of his A/c Net Effect will be zero
d. Compensating Errors	iv. Wages paid for the installation of a new machinery charged to Wages A/c instead of Machinery A/c

a - (ii), b - (i), c - (iv), d - (iii)

a - (i), b - (ii), c - (iii), d - (iv)

a - (i), b - (ii), c - (iv), d - (iii)

a - (ii), b - (i), c - (iii), d - (iv)

Solution

when a transaction is not recorded, it is an error of omission
error in balancing of an account is an error of commission
treatment of a capital expenditure as a revenue expenditure is an error of principle
when two errors cancel the effect of each other, they are compensating errors.

Question 10
1 / -0

Purchase Book has been undercast (short totalled) by Rs.100, so the purchase A/c will be debited short by Rs.100, decreasing the debit side of Trial Balance by Rs.100.It is an example of which error?

A
Error in Totalling or Balancing of Ledger A/c

B
Error of Posting

C
Wrong Totalling of Subsidiary Book

D
Error of Recording in the Book Of Original Entry

Solution

Purchase book is a subsidiary book which has been casted/totalled short. So it is an error of wrong totalling of the subsidiary book.

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Trial Balance Test - 4

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Trial Balance Test - 4

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Question 1

Adding up the returns inwards journal as Rs.11400 instead of Rs.12600

Recording in the purchase journal an invoice for acquiring a non current assets for Rs.60000

Failing to record a purchase invoice for Rs.54000 in the purchase journal

Recording a sales invoice for Rs.65000 in the sales journal

Solution

Question 2

Debit sales account and credit Chetan’s account with Rs.2700

Debit Chetan's account with Rs.2,700

Credit Chetan's account with Rs.2,700

Debit Suspense account and credit Chetan's account with Rs.2,700

Solution

Question 3

Commission

Principle

Omission

Compensating

Solution

Question 4

Debit Balance

Balance of Suspense Account

Credit Balance

Whether both sides are equal or not

Solution

Question 5

Principle

Complete omission

partial omission

Compensating

Solution

Question 6

Compensating Errors

Errors of Commission

Error of principle

Errors of Omission

Solution

Question 7

compensating errors

Error of principle

Errors of Omission

Errors of Commission

Solution

Question 8

Instead of debiting the account, it has been credited by mistake.

goods returned to supplier not recorded

Instead of posting on the debit side, amount has been posted on the credit side

Not posted in subsidiary accounts, accounts are not opened in the ledger

Solution

Question 9

a - (ii), b - (i), c - (iv), d - (iii)

a - (i), b - (ii), c - (iii), d - (iv)

a - (i), b - (ii), c - (iv), d - (iii)

a - (ii), b - (i), c - (iii), d - (iv)

Solution

Question 10

Error in Totalling or Balancing of Ledger A/c

Error of Posting

Wrong Totalling of Subsidiary Book

Error of Recording in the Book Of Original Entry

Solution

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