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Dear Sir
I hope this message finds you well
I have a (stupid) question:What is the relationship of Trial Balance imbalance and the Books of Prime Entry?
In a question I came across, it asked what the balance would be on the suspense account after errors were corrected.
In the list of errors was an error of undercasting in the sales day bookAm I correct in thinking that an error in the Books of prime entry will not affect the Trial Balance ?
Is that because the Trial balance is a list of Balances brought forward from the ledger accounts ? Therefore, if there is an undercasting error in a book of Prime entry, that isnt the same thing as saying an error exists in the ledger accounts ?Is the reason that since Books of Prime Entry are not technically double-entry books, there is no balance brought forward, therefore any errors of undercasting do not affect the Trial Balance
I’ve watched your lectures and I think I understand them, but this idea wont gel for me.
thank you for your time
kind regardsThe trial balance is prepared from the balances in the nominal/general ledger.
The figures that are entered in the nominal/general ledger are the totals from the books of prime entry.
So if the totals in the books of prime entry are wrong, then obviously the balances in the nominal/general ledger will be wrong as well, but it will not stop the trial balance balancing.
Where there can be a problem with the trial balance is where the debits and credits in the nominal/general ledger are different. This can happen either because of a simple mistake (e.g. debit with one figure and credit with another), or (more likely) when (for example) the cash book has been analysed and one of the column totals is wrong or has not been entered in the nominal/general ledger.
sir eg if there is an addition of $300 in the cashbook will it affect the trial balance ?
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