What is Suspense A/C ?

Question

Accepted Answer

Suspense A/C is a temporary account used to hold transactions until they can be properly classified.

Suspense A/C is also known as a clearing account or a transit account.
It is used when there is uncertainty or discrepancy in the classification of a transaction.
Transactions are initially recorded in the suspense account until they can be correctly allocated to the appropriate accounts.
Once the correct classification is determined, the transactions are moved from the suspense account to their respective accounts.
For example, if there is a discrepancy in the allocation of a payment received, it may be temporarily recorded in the suspense account until the correct allocation is identified.

Accepted Answer

A suspense account is a bookkeeping tool. That can be used for different purposes in different business contexts.

A company can use a suspense account to record ambiguous entries on its books that require clarification before they can be assigned to their proper accounts.

What is Suspense A/C ?

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