Accountancy Class 11

Rectification of Errors involves rectifying wrong or incorrect entries in books of accounts. Such errors could be : – Errors of omission, Errors of principle or Errors of commission. RECTIFICATION OF ERRORS OF RECORDING Recording of Transaction in Wrong Account In certain cases, while making the entries in the books of accounts, a particular payment or receipt, may be debited … Read more

One of the main objectives of preparing trial balance is that it helps in searching of errors committed by an accountant while posting entries in the books of accounts. Thus. a mismatched trial balance clearly indicates that one or more mistakes have been made. This early detection of errors makes the process of preparing the … Read more

Significance of Agreement of Trial Balance To prepare financial statements at the end of an accounting year, it is important that the trial balance should tally because it implies that both the debit and credit entries for each transaction have been posted correctly. The significance of the agreement of trial balance is the arithmetical accuracy … Read more

Theory Trial Balance Question 1 : A Trial Balance is prepared with the help of _________. Trial Balance Question 2 : What are the two methods of preparing a Trial Balance? Trial Balance Question 3 : What is Totals Method? Closing Balance of Assets,Liabilities, Expenses and Incomes Trial Balance Question 4 : Closing Balance of … Read more

The objectives of preparing a trial balance are: 1. To deduce the arithmetical accuracy of the ledger accounts. 2. To help in detecting errors. 3. To help in preparing the financial reports and statements. (profit and Loss account and Balance Sheet). 1. To deduce the arithmetical accuracy of the ledger accounts: As stated before, the … Read more

The basic meaning of trial balance is a summary of debit and credit balances of all the ledger accounts maintained by the organization. The major objective of preparing a trial balance is to check the arithmetical accuracy and correctness of ledgers. Trial Balance forms the basis for preparing the financial statements at the end of … Read more

Bank Reconciliation Statement Questions can be divided into the following four categories  : – There is a Debit  balance in the books of accounts, and a debit  balance as per the bank passbook There is a Debit  balance in the books of accounts, and a  credit balance as per the bank passbook There is a  credit balance in the books of accounts, and a … Read more

After recognizing the causes of difference in bank balance, the reconciliation might be done in the following two ways: (a) Preparing the bank reconciliation statement without adjusting the cash book balance. (b) Preparing the bank reconciliation statement after adjusting the cash book balance. It might be noticed in practice that the bank reconciliation statement is … Read more

What is Bank Reconciliation Statement ?  This question, is relevant for most of the accountants, who are responsible for managing the  bank statement of an organization. In simple language, a bank reconciliation statement, is a statement , which identifies the reasons for difference in balance of the bank as per the  books of accounts of the the business, and the balance which is as per the records … Read more

What is the Balancing of Accounts? We know that there are ledger accounts have debit side and credit side.  Both side has few entries. Sometimes one side may not have any entries. Following procedure is followed to balance the accounts. Add both sides of the account and find out the bigger side of the account. … Read more