What is suspense Account? Give one example with entries of suspense Account.

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Solution

Suspense Account is the account that is used to rectify all one sided errors or erros that affect Trial Balance.

Example:
Purchase Book undercast by Rs. 300

Solution:
Purchases A/c 300
To Suspense A/c 300
(Being Purchase Book undercast, now rectified.)

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Similar questions

What is a suspense account? Is it necessary that a suspense account will balance off after rectification of the errors detected by the accountant? If not, then what happens to the balance still remaining in suspense account?

Q. There was an error in the Trial Balance of Mr. Steel on 31st March, 2015, and the difference in Books was carried to a Suspense Account. On going through the Books you find that:
(i) ₹ 5,400 received from Mr. A was posted to the debit of his account.
(ii) ₹ 1,000 being purchases return were posted to the debit of Purchases Account.
(iii) Discount received ₹ 2,000 was posted to the debit of Discount Account.
(iv) ₹ 2,740 paid for Repairs to Motor Car was debited to Motor Car Account as ₹ 1,740.
(v) ₹ 4,000 paid to B was debited to A's Account.
Give Journal Entries to rectify the above errors and ascertain the amount transferred to Suspense Account on 31st March, 2015 by showing the Suspense Account, assuming that the Suspense Account is balanced after the above corrections.

Q. Answer in one sentence only :-

When is suspense account opened?

Q. What should happen if the balance on a Suspense Account is of a material amount?

Q. Answer the question.
What is Suspense Account?

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What is suspense Account? Give one example with entries of suspense Account.

Suspense Account is the account that is used to rectify all one sided errors or erros that affect Trial Balance. Example: Purchase Book undercast by Rs. 300 Solution: Purchases A/c 300 To Suspense A/c 300 (Being Purchase Book undercast, now rectified.)

Suspense Account is the account that is used to rectify all one sided errors or erros that affect Trial Balance.

Example:
Purchase Book undercast by Rs. 300

Solution:
Purchases A/c 300
To Suspense A/c 300
(Being Purchase Book undercast, now rectified.)