Chapter 7 Flashcards
1
Q
What are three types of errors that affect the trial balance?
A
Incorrect totalling in any account, recording only the debit or credit, using different figures for debit and credit entries
2
Q
What are the six types of errors that do not affect the trial balance?
A
Errors of omission/commission/principle/compensating errors/errors of original entry/errors of complete reversal
3
Q
A temporary account opened to make the trial balance totals equal. It acts as a holding account until the error(s) causing the inequality in the trial balance totals is discovered
A
Suspense account
4
Q
Difference between sales revenue and cost of sales
A
Gross profit
5
Q
Difference between gross profit and expenses incurred by the business
A
Profit for the year
