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Test: Trial Balance and Rectification of Errors- Case Based Type Questions - SSC CGL MCQ


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12 Questions MCQ Test SSC CGL Tier 2 - Study Material, Online Tests, Previous Year - Test: Trial Balance and Rectification of Errors- Case Based Type Questions

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Test: Trial Balance and Rectification of Errors- Case Based Type Questions - Question 1

A brief-case purchased for Rs.800 for the son of a partner was debited to General Exp. A/c with Rs.80. In the rectifying entry, Drawings A/c should be debited with:

Detailed Solution for Test: Trial Balance and Rectification of Errors- Case Based Type Questions - Question 1

Drawings A/C dr. 800

To general expenses A/C 80

To suspense A/c 720

Test: Trial Balance and Rectification of Errors- Case Based Type Questions - Question 2

Wages paid to a worker making additions to machinery amounting to Rs. 5,000 were debited to the Wages account. Identify the type of error.

Detailed Solution for Test: Trial Balance and Rectification of Errors- Case Based Type Questions - Question 2
Errors are classified as:
  • Error of Omission

  • Error of Commission

  • Error of Principle

  • Compensating error

All the expenses paid for purchase of machinery should be debited to machinery account as its a capital expenditure. Hence, Wages paid for installation of machinery debited to wages account is an error of principle.

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Test: Trial Balance and Rectification of Errors- Case Based Type Questions - Question 3

Purchased goods from Gopal for Rs.3,600 but was recorded in Gopal’s A/c as Rs.6,300. In the rectifying entry, Gopal’s A/c will be debited with :

Detailed Solution for Test: Trial Balance and Rectification of Errors- Case Based Type Questions - Question 3
As Gopal is credited with 6300 instead of 3600. To rectify this error, Gopal account should be debited with the difference i.e., 2700 (6300-3600).

Correct Entry

Purchases a/c Dr. 3600

To Gopal a/c 3600

Incorrect Entry

To Gopal a/c (wrong posting in ledger) 6300

Rectifying Entry

Gopal a/c Dr. 2700

Test: Trial Balance and Rectification of Errors- Case Based Type Questions - Question 4

Trial balance is prepared to check

Detailed Solution for Test: Trial Balance and Rectification of Errors- Case Based Type Questions - Question 4
A trial balance is prepared at the end of the accounting period or at the end of each month, the balances of the ledger accounts are extracted and is prepared to test as to whether the total debits are equal to total credits. Its prepared to check the arithmetical accuracy of the books of account.
Test: Trial Balance and Rectification of Errors- Case Based Type Questions - Question 5

Rent paid to the landlord amounting to Rs.500 was credited to Rent A/c with Rs.5,000. In the rectifying entry, Rent A/c will be debited with :

Detailed Solution for Test: Trial Balance and Rectification of Errors- Case Based Type Questions - Question 5
Rent paid Rs.500 need to be debited to Rent A/ c but instead Rent a/c is credited with Rs.5000.

Hence Rent a/c will be debited by Rs.5500 i.e. Rs.500 for actual rent & Rs.5000 to nullify the wrong posting.

Test: Trial Balance and Rectification of Errors- Case Based Type Questions - Question 6

Purchased goods from Gopal for Rs.3,600 but was recorded as Rs.6,300 to the debit of Gopal. In the rectifying entry, Gopal’s A/c will be credited with :

Detailed Solution for Test: Trial Balance and Rectification of Errors- Case Based Type Questions - Question 6
As Gopal is credited with 6300 instead of 3600. To rectify this error, Gopal account should be debited with the difference i.e., 9,900 (6300 + 3600).
Test: Trial Balance and Rectification of Errors- Case Based Type Questions - Question 7

Sohan returned goods to us amounting Rs.4,200 but was recorded as Rs.2,400 in his account. In the rectifying entry, Sohan’s A/c will be credited with :

Detailed Solution for Test: Trial Balance and Rectification of Errors- Case Based Type Questions - Question 7
Return goods of Rs. : 4200

Less : Wrongly entered as : 2400

(1800)

So, Sohan's Account will be credited with Rs. 1800

Test: Trial Balance and Rectification of Errors- Case Based Type Questions - Question 8

The Company incorrectly recorded a deposit of daily credit sales of Rs. 4,500 as Rs. 5,400. What is the appropriate entry, the company should follow regarding the error of Rs. 900?

Detailed Solution for Test: Trial Balance and Rectification of Errors- Case Based Type Questions - Question 8
Appropriate Entry are

Sales (Dr) whereas Account Receivable (Cr) with Rs. 900

Test: Trial Balance and Rectification of Errors- Case Based Type Questions - Question 9

Read the following hypothetical Case Study and answer the given questions:

An accountant while balancing his books on 31st December 2016 found that there was a difference of ₹270 in the trial balance. Being required to prepare the final accounts he placed the difference to a newly opened Suspense A/c, which was carried forward to the next year when the following errors were discovered:

  • Salary for the month of March was posted twice ₹155.

  • Interest on investment collected by the bankers, were posted directly in concerned accounts through the pass book, but no entry was made in the bank column of the cash book ₹75.

  • Rent of ₹350 received from Ashok credited both to Rent Account and Ashok Account.

  • A purchase of a chair from Karnal Furniture Mart for ₹65 has been entered in the purchase book as ₹56.

  • Old Machinery sold to the proprietor Keshav for ₹400 was entered in the Sales Book as sale to Kishore.

  • Cash Purchases from Ajay ₹189 were recorded in Cash Book as well as in Purchases Book and posted from both.

  • Closing Stock has been undervalued by ₹300.

  • The Profit & Loss Account disclosed a net profit of ₹15,000 for the year ended 31st March 2016.

Q. What will be the journal entry for the balance of Profit and Loss Adjustment Account?

Detailed Solution for Test: Trial Balance and Rectification of Errors- Case Based Type Questions - Question 9
The journal entry for the balance of Profit and Loss Adjustment Account

Profit & Loss Adjustment A/c Dr. 300

To Capital A/c 300

(Being balance of Profit & Loss Adjustment A/c transferred to Capital A/c)

Test: Trial Balance and Rectification of Errors- Case Based Type Questions - Question 10

Read the following hypothetical Case Study and answer the given questions:

An accountant while balancing his books on 31st December 2016 found that there was a difference of ₹270 in the trial balance. Being required to prepare the final accounts he placed the difference to a newly opened Suspense A/c, which was carried forward to the next year when the following errors were discovered:

  • Salary for the month of March was posted twice ₹155.

  • Interest on investment collected by the bankers, were posted directly in concerned accounts through the pass book, but no entry was made in the bank column of the cash book ₹75.

  • Rent of ₹350 received from Ashok credited both to Rent Account and Ashok Account.

  • A purchase of a chair from Karnal Furniture Mart for ₹65 has been entered in the purchase book as ₹56.

  • Old Machinery sold to the proprietor Keshav for ₹400 was entered in the Sales Book as sale to Kishore.

  • Cash Purchases from Ajay ₹189 were recorded in Cash Book as well as in Purchases Book and posted from both.

  • Closing Stock has been undervalued by ₹300.

  • The Profit & Loss Account disclosed a net profit of ₹15,000 for the year ended 31st March 2016.

Q. What will be the rectification entry of the salary for the month of march posted twice?

Detailed Solution for Test: Trial Balance and Rectification of Errors- Case Based Type Questions - Question 10
The rectification entry of the salary for the month of march posted twice

Suspense A/c Dr. 155

To Profit & Loss Adjustment A/c 155

(Being rectification of salary posted twice in the books)

Test: Trial Balance and Rectification of Errors- Case Based Type Questions - Question 11

Read the following hypothetical Trial Balance extracted from the books of M/s Ravilal and Company and answer the given questions:

In the books of M/s Ravilal and Company

Trial Balance as on 31/3/2018

Q. Which of the following items appears on the wrong side of the trial Balance?

Detailed Solution for Test: Trial Balance and Rectification of Errors- Case Based Type Questions - Question 11
Premises is an asset for business and like all other assets of business which has debit balance as normal default balance it also has debit balance.
Test: Trial Balance and Rectification of Errors- Case Based Type Questions - Question 12

Read the following hypothetical Trial Balance extracted from the books of M/s Ravilal and Company and answer the given questions:

In the books of M/s Ravilal and Company

Trial Balance as on 31/3/2018

Q. What should be the actual total in the rectified Trial Balance?

Detailed Solution for Test: Trial Balance and Rectification of Errors- Case Based Type Questions - Question 12
The actual total in the rectified Trial Balance is ₹18,21,000.
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