Rectification of Errors before Preparation of Trial Balance

The video tutorial discusses the rectification of accounting errors at different stages, focusing on errors before the preparation of the trial balance. It provides examples of double entry errors, one-sided errors, and overcasting errors, explaining how to rectify each. The session concludes with a preview of the next topic: suspense accounts.

At which stage can errors be detected before the preparation of the trial balance?

• During the audit process

• After the trial balance is prepared

• Before preparing the trial balance

• After preparing final accounts

What is the correct rectified entry for an office rent recorded twice?

• Office Rent Account Debit 18000 to Cash Account 18000

• Cash Account Debit 18000 to Office Rent Account 18000

• Cash Account Debit 36000 to Office Rent Account 36000

• Office Rent Account Debit 36000 to Cash Account 36000

How should a one-sided error in the electricity account be rectified?

• Debit Cash Account by 200

• Debit Electricity Account by 200 and Credit Cash Account by 200

• No entry; just debit Electricity Account by 200

• Credit Electricity Account by 200

What should be done if the debit and credit amounts are not equal in a rectification entry?

• Record the entry as it is

• Ignore the error

• Adjust the amounts to make them equal

• Write a rectification statement

How is an overcast sales book rectified?

• Credit Sales Account by the excess amount

• Debit Sales Account by the excess amount

• Adjust the cash account

• No entry; just note the error

What is the effect of overcasting on an account?

• The account balance remains unchanged

• The reported total is higher than the actual total

• The account is debited by mistake

• The reported total is less than the actual total

If a purchase account is undercast, what should be done?

• Credit the purchase account

• Debit the purchase account

• Write a rectification statement

• Ignore the error