Economics · Accounting

Evaluate the following statements related to accounting principles and practices: Statement 1: A trial balance prepared at the end of the year includes only the balances of personal and real accounts while nominal accounts are excluded. Statement 2: Errors of omission where a transaction is completely left out of the journal will prevent the trial balance from tallying by the amount of the omitted transaction. Statement 3: Adjusting entries for accrued income result in a debit to an asset account and a credit to an income account in the profit and loss statement. Statement 4: Closing entries for interest received by a bank involve debiting the Interest Account and crediting the Profit and Loss Account. Statement 5: The suspense account balance is always shown on the liabilities side of the balance sheet regardless of whether it is a debit or credit balance to maintain conservatism. Statement 6: Rectifying a one-sided error after the trial balance is prepared always requires the use of the suspense account. Statement 7: The trial balance is usually prepared before passing adjusting entries to check the raw ledger balances for arithmetical errors. Select the correct conclusion: