When a Suspense Account is opened to balance the Trial Balance, where is its remaining debit balance shown if not fully rectified before year-end?
Answer and explanation
Correct answer: A. On the assets side of the Balance Sheet
- Step 1: A debit balance in Suspense Account indicates that total debits in the Trial Balance were short compared to credits.
- Step 2: If unrectified when preparing the balance sheet, it is carried forward as a temporary asset.
- Step 3: Hence, a debit balance is shown on the assets side of the Balance Sheet until rectified.
Answer
On the assets side of the Balance Sheet.
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