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SSC Financial and Cost Accounting P-1 QUESTION #6136
Question 1

The total of the discount column on the debit side of the cash book had been debited to discount received instead of correctly posted. Which accounts correct this error?

  1. Discount allowed
  2. Discount received
  3. Suspense
  • 1, 2 and 3
  • 1 and 2 only✔️
  • 1 and 3 only
  • 2 and 3 only
Correct Answer Explanation

Option B (1 and 2 only) is correct.

The debit side discount column = discounts allowed. Correct entries: Debit discount allowed; Credit discount received. The error debited discount received instead of crediting it. Correction uses discount allowed and discount received only — no suspense needed as both sides of the trial balance are equally affected.