Trial balance and rectification of errors, Introduction- Specimen of a Trial Balance- Errors and their rectification – Rectification of errors Rectification of errors detected after the preparation of Trial Balance but before the preparation of Final Accounts- Effect of errors on Profit – Rectification of errors appearing after the preparation of Final Accounts
Ledger in financial accounting (11th commerce)Yamini Kahaliya
This presentation is on ledger which is the topic of financial accounting. it contents details about following points. There are:-
1. Meaning of ledger
2. Need & Importance of ledger
3. Advantage of Ledger
4. Difference b/w Journal & ledger
5. Format of ledger
6. Rules of posting
7. Illustrations
8. Exercise
Ledger in financial accounting (11th commerce)Yamini Kahaliya
This presentation is on ledger which is the topic of financial accounting. it contents details about following points. There are:-
1. Meaning of ledger
2. Need & Importance of ledger
3. Advantage of Ledger
4. Difference b/w Journal & ledger
5. Format of ledger
6. Rules of posting
7. Illustrations
8. Exercise
Control accounts the account which represents a particular sub ledger, sales ledger and purchases ledger control accounts.
At the end of an accounting period the accounts are balanced off and a trial balance prepared to check the accuracy of the book keeping entries. If a trial balance fails to balance this usually indicates that an error or errors may have been made and needs to be identified. As the business expands the accounting requirements increase which may lead to more errors occurring which are very difficult to find.
Humans can make unintentional errors, but in Accounting, there is an option to make a Rectification entry for the errors.
Some errors affect the Trial Balance, some not
Rectification of errors depends on the timing of its detection:
1.Errors detected before preparation of Trial Balance are corrected by
"Writing a Narration" for Single Sided Errors &
" Rectified entry for Double Sided Error"
2. Errors detected after Trial Balance : by
" Opening Suspense A/C for Single Sided Errors"
" Rectification Entry"
3. Errors detected in Next accounting period :
Through P&L Adjustment Accounts
It is the system in which both the aspects i.e. debit as well as credit are recorded in the books of accounts .It records transactions relating to all the accounts i.e. personal, real and nominal.
Control accounts the account which represents a particular sub ledger, sales ledger and purchases ledger control accounts.
At the end of an accounting period the accounts are balanced off and a trial balance prepared to check the accuracy of the book keeping entries. If a trial balance fails to balance this usually indicates that an error or errors may have been made and needs to be identified. As the business expands the accounting requirements increase which may lead to more errors occurring which are very difficult to find.
Humans can make unintentional errors, but in Accounting, there is an option to make a Rectification entry for the errors.
Some errors affect the Trial Balance, some not
Rectification of errors depends on the timing of its detection:
1.Errors detected before preparation of Trial Balance are corrected by
"Writing a Narration" for Single Sided Errors &
" Rectified entry for Double Sided Error"
2. Errors detected after Trial Balance : by
" Opening Suspense A/C for Single Sided Errors"
" Rectification Entry"
3. Errors detected in Next accounting period :
Through P&L Adjustment Accounts
It is the system in which both the aspects i.e. debit as well as credit are recorded in the books of accounts .It records transactions relating to all the accounts i.e. personal, real and nominal.
A trial balance is an accounting statement prepared to demonstrate the accuracy and correctness of total balances of debits and credits of all ledger accounts. This presentation is dedicated by Innoclazz Academy
This presentation is based on the subject Financial Accounting which helps the beginners to know the basic concept of accounting . This is according to the syllabus of Pt. Ravishankar University , Raipur and Durg University, Durg.
Introduction to computerised accountingItisha Sharma
MEANING OF COMPUTERISED ACCOUNTING
TRADITIONAL/MANUAL SYSTEM OF ACCOUNTING
PROCESS OF COMPUTERISED ACCOUNTING
FEATUERES OF COMPUTERISED ACCOUNTING
ADVANTAGES AND DISADVANTAGES OF COMPUTERISED ACCOUNTING
PROCESS/STEPS IN COMPUTERISED FINANCIAL ACCOUNTING
ADVANTAGES OF THE COMPUTERISED FINANCIAL ACCOUNTING SYSTEM
VARIOUS COMPONENTS OF A COMPUTERISED FINANCIAL ACCOUNTING SYSTEM
DIFFERENCE BETWEEN MANUAL ACCOUNTING SYSTEM AND COMPUTERISED ACCOUNTING
Hire Purchase System
The process of Hire Purchase
Features of Hire Purchase
Advantages and Disadvantages of Hire Purchase
Contents of Hire Purchase agreement
Installment Purchase
Important Definitions
Difference between Hire Purchase and Installment Purchase
Difference between Sales and Hire Purchase
Lease
Features of Lease
Merits and Demerits of Lease
Difference between Hire Purchase and Lease
Valuation of shares, nature of shares, factors affecting shares, need for valuation of shares, method of valuation of shares, net asset based method, yield based method, fair value method
Bills of exchange entries in case of drawer and drawee, the difference between promissory note and bill of exchange, advantage of using bill of exchange, consignment,
This presentation talks about Meaning, of accounting, distinction between book keeping and accounting, Branches of accounting, Objectives of accounting, Uses and users of accounting information, Advantages of Accounting, Is accounting a science or an art, double entry system of financial accounting, limitations of financial accounting, important terms, journal entry, accounting concepts and conventions
Unit 8 - Information and Communication Technology (Paper I).pdfThiyagu K
This slides describes the basic concepts of ICT, basics of Email, Emerging Technology and Digital Initiatives in Education. This presentations aligns with the UGC Paper I syllabus.
Normal Labour/ Stages of Labour/ Mechanism of LabourWasim Ak
Normal labor is also termed spontaneous labor, defined as the natural physiological process through which the fetus, placenta, and membranes are expelled from the uterus through the birth canal at term (37 to 42 weeks
June 3, 2024 Anti-Semitism Letter Sent to MIT President Kornbluth and MIT Cor...Levi Shapiro
Letter from the Congress of the United States regarding Anti-Semitism sent June 3rd to MIT President Sally Kornbluth, MIT Corp Chair, Mark Gorenberg
Dear Dr. Kornbluth and Mr. Gorenberg,
The US House of Representatives is deeply concerned by ongoing and pervasive acts of antisemitic
harassment and intimidation at the Massachusetts Institute of Technology (MIT). Failing to act decisively to ensure a safe learning environment for all students would be a grave dereliction of your responsibilities as President of MIT and Chair of the MIT Corporation.
This Congress will not stand idly by and allow an environment hostile to Jewish students to persist. The House believes that your institution is in violation of Title VI of the Civil Rights Act, and the inability or
unwillingness to rectify this violation through action requires accountability.
Postsecondary education is a unique opportunity for students to learn and have their ideas and beliefs challenged. However, universities receiving hundreds of millions of federal funds annually have denied
students that opportunity and have been hijacked to become venues for the promotion of terrorism, antisemitic harassment and intimidation, unlawful encampments, and in some cases, assaults and riots.
The House of Representatives will not countenance the use of federal funds to indoctrinate students into hateful, antisemitic, anti-American supporters of terrorism. Investigations into campus antisemitism by the Committee on Education and the Workforce and the Committee on Ways and Means have been expanded into a Congress-wide probe across all relevant jurisdictions to address this national crisis. The undersigned Committees will conduct oversight into the use of federal funds at MIT and its learning environment under authorities granted to each Committee.
• The Committee on Education and the Workforce has been investigating your institution since December 7, 2023. The Committee has broad jurisdiction over postsecondary education, including its compliance with Title VI of the Civil Rights Act, campus safety concerns over disruptions to the learning environment, and the awarding of federal student aid under the Higher Education Act.
• The Committee on Oversight and Accountability is investigating the sources of funding and other support flowing to groups espousing pro-Hamas propaganda and engaged in antisemitic harassment and intimidation of students. The Committee on Oversight and Accountability is the principal oversight committee of the US House of Representatives and has broad authority to investigate “any matter” at “any time” under House Rule X.
• The Committee on Ways and Means has been investigating several universities since November 15, 2023, when the Committee held a hearing entitled From Ivory Towers to Dark Corners: Investigating the Nexus Between Antisemitism, Tax-Exempt Universities, and Terror Financing. The Committee followed the hearing with letters to those institutions on January 10, 202
Synthetic Fiber Construction in lab .pptxPavel ( NSTU)
Synthetic fiber production is a fascinating and complex field that blends chemistry, engineering, and environmental science. By understanding these aspects, students can gain a comprehensive view of synthetic fiber production, its impact on society and the environment, and the potential for future innovations. Synthetic fibers play a crucial role in modern society, impacting various aspects of daily life, industry, and the environment. ynthetic fibers are integral to modern life, offering a range of benefits from cost-effectiveness and versatility to innovative applications and performance characteristics. While they pose environmental challenges, ongoing research and development aim to create more sustainable and eco-friendly alternatives. Understanding the importance of synthetic fibers helps in appreciating their role in the economy, industry, and daily life, while also emphasizing the need for sustainable practices and innovation.
Honest Reviews of Tim Han LMA Course Program.pptxtimhan337
Personal development courses are widely available today, with each one promising life-changing outcomes. Tim Han’s Life Mastery Achievers (LMA) Course has drawn a lot of interest. In addition to offering my frank assessment of Success Insider’s LMA Course, this piece examines the course’s effects via a variety of Tim Han LMA course reviews and Success Insider comments.
Macroeconomics- Movie Location
This will be used as part of your Personal Professional Portfolio once graded.
Objective:
Prepare a presentation or a paper using research, basic comparative analysis, data organization and application of economic information. You will make an informed assessment of an economic climate outside of the United States to accomplish an entertainment industry objective.
Francesca Gottschalk - How can education support child empowerment.pptxEduSkills OECD
Francesca Gottschalk from the OECD’s Centre for Educational Research and Innovation presents at the Ask an Expert Webinar: How can education support child empowerment?
Biological screening of herbal drugs: Introduction and Need for
Phyto-Pharmacological Screening, New Strategies for evaluating
Natural Products, In vitro evaluation techniques for Antioxidants, Antimicrobial and Anticancer drugs. In vivo evaluation techniques
for Anti-inflammatory, Antiulcer, Anticancer, Wound healing, Antidiabetic, Hepatoprotective, Cardio protective, Diuretics and
Antifertility, Toxicity studies as per OECD guidelines
Welcome to TechSoup New Member Orientation and Q&A (May 2024).pdfTechSoup
In this webinar you will learn how your organization can access TechSoup's wide variety of product discount and donation programs. From hardware to software, we'll give you a tour of the tools available to help your nonprofit with productivity, collaboration, financial management, donor tracking, security, and more.
Embracing GenAI - A Strategic ImperativePeter Windle
Artificial Intelligence (AI) technologies such as Generative AI, Image Generators and Large Language Models have had a dramatic impact on teaching, learning and assessment over the past 18 months. The most immediate threat AI posed was to Academic Integrity with Higher Education Institutes (HEIs) focusing their efforts on combating the use of GenAI in assessment. Guidelines were developed for staff and students, policies put in place too. Innovative educators have forged paths in the use of Generative AI for teaching, learning and assessments leading to pockets of transformation springing up across HEIs, often with little or no top-down guidance, support or direction.
This Gasta posits a strategic approach to integrating AI into HEIs to prepare staff, students and the curriculum for an evolving world and workplace. We will highlight the advantages of working with these technologies beyond the realm of teaching, learning and assessment by considering prompt engineering skills, industry impact, curriculum changes, and the need for staff upskilling. In contrast, not engaging strategically with Generative AI poses risks, including falling behind peers, missed opportunities and failing to ensure our graduates remain employable. The rapid evolution of AI technologies necessitates a proactive and strategic approach if we are to remain relevant.
Introduction to AI for Nonprofits with Tapp NetworkTechSoup
Dive into the world of AI! Experts Jon Hill and Tareq Monaur will guide you through AI's role in enhancing nonprofit websites and basic marketing strategies, making it easy to understand and apply.
Read| The latest issue of The Challenger is here! We are thrilled to announce that our school paper has qualified for the NATIONAL SCHOOLS PRESS CONFERENCE (NSPC) 2024. Thank you for your unwavering support and trust. Dive into the stories that made us stand out!
Safalta Digital marketing institute in Noida, provide complete applications that encompass a huge range of virtual advertising and marketing additives, which includes search engine optimization, virtual communication advertising, pay-per-click on marketing, content material advertising, internet analytics, and greater. These university courses are designed for students who possess a comprehensive understanding of virtual marketing strategies and attributes.Safalta Digital Marketing Institute in Noida is a first choice for young individuals or students who are looking to start their careers in the field of digital advertising. The institute gives specialized courses designed and certification.
for beginners, providing thorough training in areas such as SEO, digital communication marketing, and PPC training in Noida. After finishing the program, students receive the certifications recognised by top different universitie, setting a strong foundation for a successful career in digital marketing.
2. Topics Covered
• What is Trial Balance
• Format of Trail Balance
• Objective of Trial Balance
• Significance of Trial Balance
• Methods of Making a Trial Balance
• Classification of Errors
• Rectification of Errors
4. What is Trial Balance
The Trial Balance is a table where we lay out all
our debit accounts and all our credit accounts to
see if they balance or not.
5. Format of Trial Balance
Titles: Name of the company, trial balance and date of preparation are
written.
Account Titles: For example, Capital account, Furniture account, Cash account etc
Debit balance: All debit balances of ledger
accounts are written in this column.
Credit balance: All credit balances of ledger
accounts are written in this column.
6. Objective of Trial Balance
• To check arithmetical accuracy
Arithmetical accuracy in ledger posting means writing correct amount, in the correct account and on its
correct side while posting transactions from various original books of accounts, such as Cash Book,
Purchases Book, Sales Book, etc. It also means not only the correct balance of ledger account but also
the totals of the special purpose Books.
• To help in preparing Financial Statements
The ultimate objective of the accounting is to prepare financial statements i.e. Trading and Profit and
Loss Account, and Balance sheet of a business enterprise at the end of an accounting year. These
statements contain balances of various ledger accounts. As Trial Balance contains balances of all ledger
accounts, in financial statements the balances of ledger accounts are carried from the Trial balance for
proper analysis
• Helps in locating errors
If total of two columns of the trial balance agrees it is a proof of arithmetical accuracy in the ledger
posting. However, if the totals of the two columns do not tally it indicates that there is some mistake in
the ledger accounts. This prompts the accountant to find out the errors.
7. • Helps in comparison
Comparison of ledger account balances of one year with the corresponding balances
with the previous year helps the management taking some important decisions. This
is possible by using the Trial Balances of the two years.
• Helps in making adjustments
While making financial statements adjustments regarding closing stock, prepaid
expenses, outstanding expenses etc are to be made. Trial balance helps in identifying
the items requiring adjustments in preparing the financial statements
8. Characteristics
• Trial balance is neither an account nor a part of it. It is a
statement containing all balances of ledger accounts.
• It is not recorded in any book of account. The trial balance is
prepared in a separate sheet or paper.
• The trial balance is prepared with the balances of accounts at the
end of a particular accounting period. A trial balance is prepared
before preparation of financial statements at the end of
accounting period.
• The statement contains all kinds of accounts, irrespective of their
classifications, such as assets liabilities, income-expenses etc. It
helps to test the arithmetical accuracy of accounts.
•
9. Methods of Making Trial
Balance
• Balance Method
In this Balance method, the balance of each account (which may be debit
balance or credit balance) is extracted and written against each account; we
write debit balance in the debit column and credit balance in the credit
column.
• Total Method
In this method the total of both sides of every account in the ledger is
written against the name of the respective account without balancing them
in the form of debit and credit balances respectively.
• Balance totals Method
Trial Balance is prepared by combining the first and second methods.
21. Classification of errors
• Error of Principle : if accountant records any transaction against the rules of double
entry system, then this mistake is called error of principle
• Clerical Error
a) Errors of Omission: If accountant forgets to pass the journal entry of any transaction or if
he records only one part of transaction, then these mistakes are called errors of omission.
Accountant can also forget to post any journal entry in ledger accounts.
b) Errors of Commission: If accountant passes the wrong entry or posts wrong side of
ledger accounts or writes wrong amount or calculates wrong total of any account, then
these types of mistakes are called errors of commission. Some of errors of commission can
easy find out by making trial balance but some errors of commission can not find out
through trial balance.
c) Compensating Errors :Sometime we compensate one error with any other errors. For
example we write Rs. 500 less in the credit side of sales account but same time we write
less Rs. 500 in the debit side of purchase account. This is the error which can not be
revealed through trial balance.
22. Stages of Rectification
• Rectification before the preparation of Trial
Balance: By debiting or crediting the
respective account with the required amount
by giving an explanatory note in the particular
columns.
• Rectification after the preparation of Trial
Balance: By writing a journal entry with the
respective account/s affected by the errors
and suspense account
23. Basic Principles of
Rectification of Errors
Errors Solution
Excess debit in one or more accounts Credit the excess account
Short debit in one or more accounts Further debit to the respective
accounts
Excess credit in one or more
accounts
Debiting the respective account with
the excess amount involved
Short credit in one or more accounts Further credit the respective account
24. 3 important models of
rectification of errors
• Overcasting and under casting
• Before preparing the Trial balance
• After preparing the Trial balance
25. Numerical 6
Rectify the following errors
• Purchase book overcast by Rs 300
• Purchase return book overcast by Rs 150
• Sales book undercast by Rs 2000
• Sales return book undercast by Rs 200
26. Sno. Nature of Mistake Effect of Mistake Rectification
1 Overcast of Purchase book Excess debit in
Purchase account
Credit the
purchase account
2 Overcasting of Purchase
Return book
Excess credit in
Purchase return
book
Debit the
Purchase Return
book
3 Undercasting of Sale Book Short credit in
sales account
Give further
credit to sales
account
4 Undercasting of Sales return
book
Short debit in
sales return book
Give further debit
to sales return
book
45. What is a suspense
account?
• an account in the books of an organization in
which items are entered temporarily before
allocation to the correct or final account.
• this is used for rectification of errors after
making the trial balance.
46. Numerical 13
An accountant was unable to match the trial balance. The difference of Rs 5000 was temporarily placed to the credit of
suspense account for preparing the final accounts. The following errors were located later:
1. Commission of Rs 400 paid, was posted twice, once to the discount allowed account and once to the commission
account
2. The sales book was undercast by Rs 800
3. A credit sales of Rs 2750 to Alice though correctly entered in Sales book , was posted wrongly to her account as Rs
3570
4. A credit purchase from Danila of Rs 1750, though correctly entered in purchase book, was wrongly debited to her
personal account
5. Discount column of the payment side of cash book was wrongly added as Rs 3640 instead of Rs 3120
You are required to
- Journalize the necessary rectification entries
- Prepare Suspense account
47. Errors Particulars Debit Credit
1 Suspense account
to discount allowed account
[amount wrongly debited to discount allowed account,
now rectified ]
400 400
2 Suspense account
to Sales account
[sales account was undercast, now rectified]
800 800
3 Suspense account
to Alice Account
[Alice account overcast by Rs820, now rectified]
820 820
4 Suspense account
to Danila Account
[Danila account wrongly debited and the credit entry by
Purchase account was not recorded, now rectified]
3500 3500
5 Discount Received account
to Suspense account
[excess of discount received amount was recorded, now
rectified]
520 520