SSC CGL Finance – Trial Balance & Rectification of Errors – Level 3 · Challenge

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SSC CGL Finance – Trial Balance & Rectification of Errors – Level 3 · Challenge – 8 questions, subject: Finance & Economics (Tier II Paper III). Every question has the correct answer with a one-line explanation; tap "Show Answer". Free practice for TNPSC, UPSC, SSC, Bank and RRB exams – Shanmugam IAS Academy, Coimbatore.

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1.  

Directions (Q 28–29): Priya Stores: (i) Sales Book overcast ₹ 3,000; (ii) discount allowed ₹ 400 to Raju posted to his account but not to Discount Allowed A/c; (iii) furniture ₹ 12,000 debited to Purchases; (iv) ₹ 1,700 paid to Venu posted to his account as ₹ 7,100; (v) a bill receivable ₹ 2,500 from Kumar not recorded at all.

Priya Stores: the original suspense balance was:

Correct Answer: B [Credit ₹ 2,000]

Explanation:

−3,000 − 400 + 5,400 = +2,000 → credit side short → Suspense Cr 2,000.

2.  
(Use the directions above – Q 28–29)
Priya Stores: draft profit was ₹ 64,000. Corrected profit is:

Correct Answer: A [₹ 72,600]

Explanation:

Sales Dr 3,000 (−); Discount Dr 400 (−); Purchases Cr 12,000 (+) → +8,600.

3.  
Reverse questionThe debit side of a trial balance exceeds the credit side by ₹ 3,500. Two errors explain it fully: the Sales Book was undercast by ₹ 1,500, and an amount received from Rahul was posted to the debit of his account. The amount received from Rahul was:

Correct Answer: A [₹ 1,000]

Explanation:

1,500 + 2x = 3,500 → x = 1,000.

4.  
Statement-basedWhich of these errors need the suspense account for rectification?
I. Purchases Book undercast II. Error of principle III. A sales invoice not posted to the customer's account IV. A transaction not recorded at all

Correct Answer: C [I and III only]

Explanation:

Only one-sided errors (I, III) disturb the trial balance.

5.  
Two-quantity comparisonQuantity I: increase in profit on rectifying “machinery ₹ 10,000 debited to Purchases”
Quantity II: increase in profit on rectifying “wages ₹ 4,000 for erecting machinery debited to Wages”

Correct Answer: A [Quantity I > Quantity II]

Explanation:

QI = 10,000; QII = 4,000 (depreciation ignored).

6.  
The Purchases Account and the Sales Account are both overcast by ₹ 2,000. Which is correct?

Correct Answer: B [The trial balance agrees and net profit is unaffected]

Explanation:

Compensating errors: Dr +2,000 and Cr +2,000; expense and income both up 2,000.

7.  
Goods costing ₹ 5,000 taken by the proprietor for personal use were not recorded. The rectifying entry and its effect on profit are:

Correct Answer: D [Drawings Dr, To Purchases ₹ 5,000; profit rises by ₹ 5,000]

Explanation:

Purchases (nominal) credited → profit up 5,000.

8.  
A credit sale of ₹ 2,700 to Ramesh was posted to the credit of Suresh's account. The rectifying entry is:

Correct Answer: D [Ramesh Dr 2,700; Suresh Dr 2,700; To Suspense 5,400]

Explanation:

Wrong account AND wrong side → both accounts debited; Suspense the other half.

➤ Full notes, shortcuts and every answer explained – SSC CGL 2026 Finance & Economics (Tier II Paper III) book (₹149): www.shanmugamiasacademy.in/study-materials/ssc-cgl-finance-economics

📘 SSC CGL 2026 – General Studies – Finance & Economics (Tier II Paper III)
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