WHAT DOES UNDERCAST & OVERCAST MEAN.

Overcast (or undercast) means overvaluation (or undervaluation) of the values. In accounting terminology, generally overcast and undercast are associated with the Subsidiary Books such as, Sales Book, Cash Book, Purchases Book, Sales Books, etc. Overcast of a Subsidiary Book (say, Purchases Book) implies that the total of the book is depicting an excess value than it actually is. On the other hand, undercast of a Subsidiary Book (say, Purchases Book) implies that the total of the book is lower than its actual amount. In both the cases, the total of the Subsidiary Book does not reveal the actual balance in the books.

Example of Overcast: If the total of the Purchases Book (of Rs 18,000) is overcast by Rs 2,000, then it implies that the actual (true) amount in the Purchases Book is Rs 16,000.

Example of Undercast: If the total of the Purchases Book (of Rs 18,000) is undercast by Rs 2,000, then it implies that the actual (true) amount in the Purchases Book is Rs 20,000.

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