wages paid for construction of office debited to wafes a/c rs. 20000
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OFFICE AC DR
TO WAGES AC CR
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Wages paid for constuction of office is a capital expenditure and shall be debited to Office Building A/C and not to wages A/C.
Wrong Entry :
Wages A/C dr Rs.20,000
To Cash A/C Rs.20,000
Correct Entry :
Office Building A/C Dr Rs.20,000
To Cash A/C Rs.20,000
Rectification Entry :
Office Building A/C Rs.20,000
To Wages A/C Rss.20,000
(Being Wages paid for construction of office and wrong entry rectified)
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