Question 1.
How will you rectify the following errors?
(i) Purchases Book is overcast by ₹ 10,000.
(ii) Purchases Return Book is overcast by ₹ 1,000.
(iii) Purchases Return Book’s balance is carried forward in excess by ₹ 100.
(iv) Purchases Book’s balance is carried forward in excess by ₹ 1,000.
Answers
The journal entries are shown below:
Explanation:
The journal entries which are to be recorded in order to rectify the transactions are as:
1.
Suspense A/c................................Dr Rs 10,000
To Purchases A/c...........................Cr Rs 10,000
Being the transaction is rectified as the purchase book is overcast.
As the account has been overcast, so the suspense account is created to adjust the amount which is debited and the purchase account is credited.
2.
Purchases Return A/c...........................Dr Rs 1,000
To Suspense A/c....................................Cr Rs 1,000
Being the transaction is rectified
As the account has been overcast, so the suspense account is created to adjust the amount which is credited and the purchase return account is debited.
3.
Purchases Return A/c...........................Dr Rs 100
To Suspense A/c....................................Cr Rs 100
Being the transaction is rectified
As the account has been overcast, so the suspense account is created to adjust the amount which is credited and the purchase return account is debited.
4.
Suspense A/c................................Dr Rs 1,000
To Purchases A/c...........................Cr Rs 1,000
Being the transaction is rectified
As the account has been overcast, so the suspense account is created to adjust the amount which is debited and the purchase account is credited.