Question

why do we debit wrongly credited profit in past adjustment in some questions while not in other questions ???​

Answer 1

. Past Adjustments Sometimes, after the final accounts of a firm have been closed, it is found that certain matters have been left out by mistake. In such cases, instead of altering the final accounts which have already been closed, the firm rectifies the error or omission by passing an adjustment entry in the beginning of the financial year. Such adjustments are called past adjustments as they relate to past period.

Steps to pass adjusting journal entry:

Step 1 Calculate the amount already recorded.

Step 2 Calculate the amount which should have been recorded.

Step 3 Calculate the difference between Step 1 and Step 2.

Step 4 Find out the partner who received excess and the partner who received short.

Step 5 Pass the adjusting journal entry by debiting the partner who received excess and by crediting the partner who received short.