Practice What Is A Suspense Account? (8.7.1)

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6 sample questions

Question 1.
What does a Suspense Account hold?
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Think about what happens when debits and credits don't match.
Question 2.
When do accountants use Suspense Accounts?
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Consider a scenario where mismatch occurs.
3Question 3.
What is the purpose of a Suspense Account?
- To hold permanent errors
- To temporarily hold discrepancies
- To replace the trial balance
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Consider what happens in accounting when there is a difference.
4Question 4.
True or False: A Suspense Account can become permanent.
- True
- False
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Think about the term 'temporary'.
Question 5.
If a company's trial balance shows discrepancies of ₹3,000 and ₹2,000, explain how you would handle the situation in your accounts.
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Consider reviewing all account entries to discover where adjustments are needed.
Question 6.
Suppose accounting discrepancies were found, but the errors offset each other, showing no effect on the trial balance. How should they be treated?
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Think about how each entry affects financial reporting.

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