Question
What is meant by Rectification of Errors? State its objectives.
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Answer
Rectification of Errors: Errors, whether affecting the Trial Balance or not, must be detected and corrected. The procedure followed to rectify the errors committed and to set right accounting records is called Rectification of Errors.The objectives of rectifying errors are:
- Preparing correct accounting records.
- Ascertaining correct net profit or loss for the accounting period by preparing Profit and Loss Account with the correct figures.
- Exhibiting a true and fair view of financial position of the concern at a particular date by preparing Balance Sheet with the correct accounting data.
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