PRC-1 · Chapter 8 · Question 40 of 100
A business paid Rs. 3,000 for the installation of a new machine. The amount was debited to the Repairs and Maintenance account. The trial balance will:
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) Agree, because this is an error of principle
Explanation
Errors of principle (treating capital expenditure as revenue) do not disrupt the mathematical equality of debits and credits, so the trial balance will still agree.
More Correction of Errors MCQs
- Q42Which of the following correctly describes the nature of a Suspense Account?
- Q43If the credit side of a trial balance is heavier by Rs. 1,200, the Suspense Account will be opened with:
- Q44A credit sale of Rs. 600 was completely omitted from the books. How does this affect the trial balance?
- Q45Rent received of Rs. 1,400 was correctly entered in the cash book but debited to the Rent Received account in the general ledger. What is…
- Q46To correct the error in the previous question (Rent received of Rs. 1,400 debited instead of credited to Rent Received), what journal…