Rectification of Errors
Class-11-Commerce-Book-Keeping & Accountancy-Chapter-8-Maharashtra Board
Solutions
Question 1. Answer in One Sentence:
(1) What is meant by rectification of errors?
Rectification of errors is the process of locating and correcting mistakes in the books of accounts to determine the true profit or loss and the accurate financial position of a business.
(2) What is meant by error of principle?
An error of principle occurs when transactions are recorded in violation of fundamental accounting principles and rules, such as incorrectly classifying capital items as revenue items.
(3) What is meant by error of partial omission?
An error of partial omission arises when a transaction is recorded in the books of original entry but is not posted to the ledger, which subsequently affects the agreement of the Trial Balance.
(4) What is meant by error of complete omission?
An error of complete omission happens when a transaction is entirely omitted from being recorded in the books of accounts, meaning it does not affect the agreement of the Trial Balance.
(5) What are compensating errors?
Compensating errors are two or more mistakes committed in such a way that their net effect on the debit and credit of the accounts is nil or nullified.
Question 2. Give one word/term or phrase for each of the following statements.
(1) Errors which affect the agreement of Trial Balance.
(2) Taking the total more while closing books of accounts.
(3) Error which arises when a transaction is partially or completely omitted to be recorded in the books of accounts.
(4) Transactions recorded due to violating of the accounting principles.
(5) Accounts to which difference in Trial Balance is transferred.
(6) Error in which the effect of one mistake is nullified by another mistake.
(7) Error which are not disclosed by the Trial Balance.
(8) Errors of incorrect entries or wrong posting.
| Statement | Word/Term/Phrase | |
| (1) | Errors which affect the agreement of Trial Balance. | One sided errors |
| (2) | Taking the total more while closing books of accounts. | Overcasting |
| (3) | Error which arises when a transaction is partially or completely omitted to be recorded in the books of accounts. | Error of omission |
| (4) | Transactions recorded due to violating of the accounting principles. | Error of principle |
| (5) | Accounts to which difference in Trial Balance is transferred. | Suspense account |
| (6) | Error in which the effect of one mistake is nullified by another mistake. | Compensating error |
| (7) | Error which are not disclosed by the Trial Balancc. | Two sided errors |
| (8) | Errors of incorrect entries or wrong posting. | Error of commission |
Question 3. Select the most appropriate alternative from those given below and rewrite the sentence.
(1) Rectification entries are passed in -----------------.
(a) Journal Proper (b) Ledger
(c) Balance sheet (d) Cash Book
(a) Journal Proper
(2) The type of error for which journal entry is always required for rectification ------.
(a) over casting (b) one sided error
(c) under casting (d) two sided error
(d) two sided error
(3) Errors occurred due to wrong posting are called as errors of -------------.
(a) principle (b) commission
(c) compensating (d) omission
(b) commission
(4) If transaction is totally omitted from the Books, it is called -------------.
(a) Error of recording (b) Error of omission
(c) Error of principle (d) Error of commission
(b) Error of omission
(5) Suspense Account is opened when ____ does not tally
(a) Balance sheet (b) Trading account
(c) Profit and Loss (d) Trial Balance
(d) Trial Balance
Question 4. State whether the following statements are True or False with reasons.
(1) Trial Balance is prepared from the balance of ledger accounts.
True
Reason: A Trial Balance is designed to check the arithmetic accuracy of transactions that have been recorded in the Journal, posted into the ledger, and subsequently balanced.
(2) A Trial Balance can agree in spite of certain errors.
True
Reason: Several types of errors do not affect the agreement of a Trial Balance, including errors of complete omission, errors of principle, and compensating errors.
(3) Rectification entries are passed in Cash Book.
False
Reason: According to accounting rules, rectified entries are recorded in the Journal Proper, not the Cash Book.
(4) There is no need to open a Suspense Account if the Trial Balance agrees.
True
Reason: A Suspense Account is a temporary account specifically opened to hold the difference amount when a Trial Balance does not tally.
(5) All the errors can be rectified only through Suspense Account.
False
Reason: Only one-sided errors located after the preparation of a Trial Balance are rectified using a Suspense Account. Two-sided errors are always rectified through Journal Entries, and one-sided errors found before the Trial Balance can be corrected by making a note in the affected account.
Question 5. Do you agree or disagree with the following statements.
(1) The unintentional omission or commission of amounts and accounts while recording the transactions are known as an error.
Agree
(2) The errors committed due to wrong recording, wrong posting, wrong totalling, wrong balancing, wrong calculations are known as Arithmetical errors.
Disagree
(3) When one or more debit errors happen to equal one or more credit errors it is said to be a Compensating error.
Agree
(4) The agreement of Trial balance is not affected when a transaction is not recorded at all in the original Books.
Agree
(5) When a transaction is not recorded according to the principles of accounting it is known as Compensating errors.
Disagree
Question 6. Complete the following sentence.
(1) …………… is assured only when there are no errors in the books of accounts.
(2) Transactions recorded in contravention of the accounting principles are known as …………
(3) ………… entry depends generally on when the error is detected.
(4) Temporary account opened to rectify the entry is known as………………
(5) Errors are caused due to …………… recording of transactions.
(1) Accuracy is assured only when there are no errors in the books of accounts.
(2) Transactions recorded in contravention of the accounting principles are known as Errors of Principle
(3) Rectifying entry depends generally on when the error is detected.
(4) Temporary account opened to rectify the entry is known as Suspense Account
(5) Errors are caused due to wrong recording of transactions.
PDF : Class-11-Commerce-Chapter-8-Rectification of Errors – Notes
PDF : Class-11-Commerce-Chapter-8-Rectification of Errors – Solutions (Theoretical + Practical Problem Solutions)
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