Trial balance of Khatau did not agree. He put the difference to suspense account
and discovered the following errors :
(a) Credit sales to Manas Rs. 16,000 were recorded in the purchases book
as Rs. 10,000 and posted to the debit of Manas as Rs. 1,000.
(b) Furniture purchased from Noor Rs. 6,000 was recorded through
purchases book as Rs. 5,000 and posted to the debit of Noor Rs. 2,000.
(c) Goods returned to Rai Rs. 3,000 recorded through the Sales book as
Rs. 1,000.
(d) Old machinery sold for Rs. 2,000 to Maneesh recorded through sales
book as Rs. 1,800 and posted to the credit of Manish as Rs. 1,200.
(e) Total of Returns inwards book Rs. 2,800 posted to Purchase account.
Rectify the above errors and prepare suspense account to ascertain
the difference in trial balance.
Answers
Answer:
This is the best possible answer of this question.
All entries are given with the required explanations to help you to understand more of the concepts.
Explanation:
(a) Manas A/c Dr. 15000
Suspense A/c Dr. 11000
To Sales A/c 16000
To Purchase A/c 10000
Manas account is debited with 15000 because it was debited only by 1000. Sales account is credited as it is sales. Purchase account is credited with 10000 as it was wrongly debited. The balance is transferred to suspense account.
(b) Furniture A/c Dr. 6000
Suspense A/c Dr. 7000
To purchases A/c 5000
To Noor A/c 8000
Furniture account is debited as it is purchase of furniture. Purchase account is credited as it was wrongly debited. Noor account is credited with 8000 , by 2000 as it was wrongly debited and by 6000 as it was credit purchase from Noor. Suspense account is debited with 7000 as the balance amount.
(c) Sales A/c Dr. 1000
Rai A/c Dr. 2000
To purchase return A/c 3000
Sales account is debited as it was wrongly credited. Rai account is debited with 2000 because it would have been credited by 1000 treating it as sales. Purchase return credited as the goods are returned to Rai.
(d) Sales A/c Dr. 1800
Manish A/c Dr. 3200
To Machinery A/c 2000
To suspense A/c 3000
Sales account is debited as it was wrongly credited. Manish account is debited with 3200 because it was wrongly credited with 1200 treating the transaction as sales. Machinery account is credited as it was sale of Machinery . The balance is transfered to suspense account.
(e)Sales return A/c Dr. 2800
To Purchase A/c 2800
Return Inward is sales return. we debited the sales return account and credited the purchase return as it was wrongly debited before.
Suspense Account
Particulars Amount Particulars Amount
To sundries 11000 By difference as per
Trial balance 15000
To sundries 7000 By Sundries 3000