Rectification of Errors
Types and suspense
Errors may be of omission, commission, principle, original entry or compensating. A complete omission does not affect the trial balance; a one-sided error does. When the trial balance does not agree, the difference is placed in a Suspense A/c. Rectification means passing a journal entry to correct the wrong entry. If the error is two-sided, reverse the wrong effect and record the correct effect. If it is one-sided, the suspense account is used to balance the entry.
Worked example
Goods of ₹5,000 purchased from Mohan were credited to Mohan's account but omitted from the purchases book. Correct entry: Purchases A/c Dr ₹5,000; To Mohan's A/c ₹5,000. Wrong entry: only Mohan's A/c Cr ₹5,000. Rectification: Purchases A/c Dr ₹5,000; To Suspense A/c ₹5,000. Reasoning: purchases are understated and the trial balance has an excess credit, so the suspense account is credited. After rectification, purchases and the suspense balance are corrected.
Traps that cost marks
Do not reverse the correct part of an entry. Compensating errors may cancel in the trial balance but still require rectification. An error of principle (for example, treating machinery purchase as repairs) needs a correction even if the trial balance agrees. Use the suspense account only for one-sided errors. Do not confuse a wrong account with a wrong amount. State narration to show the reasoning.