Page 241 - ISCDEBK-XI

Rectification of Errors 21.29
(iv) An amount of ` 950 due from Kailash, which has been written off as bad in the past, was unexpectedly
recovered in the previous year, and had been credited to the personal account of Kailash.
(v) A discount allowed to A. Chaudhary had been posted to his account as ` 80 in place of ` 180.
(vi) Goods purchased from B. Banerjee amounting to ` 100 had been posted to the credit of his account
as ` 1,100.
Pass Journal entries for rectifying above mistakes. Prepare the Suspense Account and show the ultimate
result of the mistakes on the last year’s Profit & Loss Adjustment Account. Also, pass a Journal entry for
transferring the balance of Profit & Loss Adjustment Account.
3. The Trial Balance extracted from the books of Ram on 31st March, 2022 had not agreed. In 2022–23 the
following errors were discovered:
(i) The total of a page of the Sales Book was carried forward to the next page as ` 6,785 instead of ` 6,587.
(ii) The total of Purchases Book was ` 1,000 short.
(iii) A sale of ` 350 to Dutta was entered in the Sales Book as ` 530.
(iv) Cash received ` 150 from M. Roy was debited to the account of N. Roy.
(v) ` 580 spent on repairs to the Delivery Van was debited to Motor Vehicles Account at ` 580.
(vi) The total of the discount column in the Cash Book on the debit side was ` 385 on a page but was
carried forward to the next page as ` 538.
(vii) Goods returned, ` 200, by Mirza were not entered in the books at all.
You are required to give Journal entries to rectify the errors in a way not to affect the profit or loss
for 2022–23.
4. Shiv Mohan closes his books on 31st March every year. In August, 2021, he found that his books for the
year 2020–21 contained some errors in spite of an agreed Trial Balance. The errors were:
(i) ` 800 paid for purchase of Office Furniture was posted to the Purchases Account.
(ii) The Sales Book was overcast by ` 250.
(iii) ` 275 paid for freight on machinery purchased was debited to Freight Account with ` 525.
(iv) Closing Stock was overstated by ` 3,000 by a wrong casting in the inventory.
(v) An amount of ` 700 was received in full settlement for a customer after allowing him a discount of
` 70, but while writing the books, the amount received was entered in the discount column and the
discount allowed was entered in the amount column.
(vi) A cheque of ` 7,330 received from Mr. Rao, after allowing him a discount of ` 70 was endorsed to
Mr. Ray in full settlement for ` 7,500. The cheque was dishonoured but no entry for dishonour was
passed in the books.
Give Journal entries to rectify the above errors.
5. A bookkeeper on taking out a Trial Balance as on 31st March, 2022, found that it did not agree. He
immediately proceeded to check the entries in the books and discovered the following errors:
(i) A cheque from A for ` 150 had been correctly entered in the Cash Book but had been posted to the
credit of A as ` 100.
(ii) Goods returned by the firm B amounting to ` 80 had been recorded in the Sales Return Book but the
entry had not been posted to the Personal Account.
(iii) A sale of ` 365 to C had been correctly entered in the Sales Book but was posted as ` 360.
(iv) Goods of ` 5,000 (Purchase Cost) taken by the proprietor have not been entered in the books.
(v) Goods of an invoice value of ` 300 had been returned by E and were taken into stock but the returns
had not been entered in the books.
Pass rectifying Journal entries.