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CMA Foundation · Fundamentals of Financial and Cost Accounting · Trial Balance

Goods sold to Mehta Traders for Rs 12,000 were correctly entered in the sales book, but the amount was posted to the debit of Mehta Traders' account as Rs 12,000 and credited to the sales account as Rs 21,000. What is the effect on the trial balance?

The credit total exceeds the debit total by Rs 9,000. Mehta Traders was debited with Rs 12,000 but sales was credited with Rs 21,000, so credits are higher by the Rs 9,000 difference. Since the two sides are unequal, the trial balance reveals this error.

  1. ADebit total exceeds credit total by Rs 9,000
  2. BCredit total exceeds debit total by Rs 9,000Correct
  3. CBoth totals remain equal
  4. DCredit total exceeds debit total by Rs 21,000

Explanation

Debit side recorded Rs 12,000 while credit side recorded Rs 21,000. Credits therefore exceed debits by 21,000 - 12,000 = Rs 9,000. The error is one of unequal posting amounts, so it is disclosed by the trial balance.

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