Suspense account is used in the correction of

A suspense account is a temporary holding account opened specifically when the trial balance fails to balance, that is, when total debits do not equal total credits after all known entries have been posted. The difference between the two totals is placed in the suspense account so that the trial balance can be made to balance provisionally while the underlying cause is investigated, and the suspense account is then cleared once the actual errors are found and corrected through the normal double entry.

Not every bookkeeping error causes this kind of imbalance. Errors such as an error of omission (a transaction left out completely), an error of principle (posted to the wrong class of account, for example treating a capital item as an expense), a compensating error, or an error of original entry (the same wrong figure posted correctly to both debit and credit) still leave total debits equal to total credits. These errors affect the accuracy of the accounts, and may distort the net profit figure, but they do not disturb the trial balance's agreement, so there is no imbalance for a suspense account to hold, and none is needed to correct them.

Examination reminder: the defining test for whether a suspense account is required is simple: does the error make the trial balance fail to balance? If yes, a suspense account is used; if the trial balance still balances despite the error, correction is made by a direct journal entry with no suspense account involved.