Question

A purchase of Rs 10,000 has been wrongly posted to the debit of Supplier's Account but had been correctly entered in the Purchases Account. This error ____________ .

• A. is an error of principle
• B. will not affect the trial balance
• C. will affect the gross profit
• D. None of these

Answer 1

The correct option is D None of these

When purchase is wrongly debited to the supplier's account but has been correctly entered in the purchases account, this is known as error of posting.

Error of posting is when a transaction is wrongly entered to another account or the amount entered is incorrect or correct amount is entered in the correct account but on the wrong side.

This error will affect the trial balance because supplier's account balance will decrease which always has a credit balance. On the other hand, purchase account is correct and has a debit balance. In the case the credit side of the trial balance will be short.

This error will not affect the gross profit of the year because purchases account balance is required for calculating the gross profit and there is no mistake in the purchases account.

Error is on the part of supplier's account which is not included for the calculation of gross profit.