6.6.3 Rectification of Errors in the Next Accounting Year
Chapter 6: Trial Balance and Rectification of Errors · ACCOUNTANCY · EN medium
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. . Rectification of Errors in the Next Accounting Year If some errors committed during an accounting year are not located and rectified before the finalisation of financial statements, suspense account cannot be closed and its balance will be carried forward to the next accounting period. When the errors committed in one accounting year are located and rectified in the next accounting year, profit and loss adjustment account is debited or credited in place of accounts of expenses/losses and incomes/ gains in order to avoid impact on the income statement of next accounting
📖 Accounts 6 (1) · Page 23
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. . Rectification of Errors in the Next Accounting Year If some errors committed during an accounting year are not located and rectified before the finalisation of financial statements, suspense account cannot be closed and its balance will be carried forward to the next accounting period. When the errors committed in one accounting year are located and rectified in the next accounting year, profit and loss adjustment account is debited or credited in place of accounts of expenses/losses and incomes/ gains in order to avoid impact on the income statement of next accounting
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