Accounting Error Cash Received Recorded as Cash Paid

  

Two sided error before preparing trial balance

When an error affects two sides, it is known two sided errors.

This type of error needs journal entry to rectify.

Such error affects two side, debit and credit.

Double entry system of bookkeeping is applied for this error.

Procedures for two sided errors before preparing trial balance are given below:

Step 1:       write correct entry of the transaction,

Step 2:       write wrong entry of the transaction,

Step 3:       write correct entry as it is,

Step 4:       change wrong entry (debit entry to credit and credit entry to debit),

Step 5:       find out rectified journal entry.

 

Cash received or income wrongly recorded as cash paid or vice versa 

Sometimes one income wrongly recorded to name of expense.

There are some transitions which are income and expenses.

They are discount, commission, interest, rent etc.

 

PROBLEM: 3A

Extracted information is before preparation trial balance:

Discount received $/₹/Rs 775 has been wrongly recorded as discount paid.

Required: Rectified journal entry

 

Given and working note:

Step 1,					Step 2,
Correct entry				÷	Wrong entry
Cash             To Discount recd.	Dr	775	775		Discount allowed           To Cash	Dr	775	775

Again, correct entry just copy and paste but wrong debit entry credited and wrong credit entry debited

Step 3,					Step 4,
Correct entry				x	Wrong entry
Cash             To Discount recd.	Dr	775	775		Cash           To Discount allowed	Dr	775	775

 Step 5,

Rectified Journal Entry

Date	Particulars		LF	Amount Dr	Amount Cr
	Cash account              To Discount received  account              To Discount allowed account (Being- discount received wrongly recorded as Discount allowed, now rectified)	Dr		1,550	775 775

 

PROBLEM: 3B

Following extracted information is given to you (before preparation trial balance):

Cash received from CK Traders (debtor) $/₹/Rs 12,300 has been debited.

Required: Rectified journal entry

 

Given and working note:

Step 1,					Step 2,
Correct entry				÷	Wrong entry
Cash             To CK Traders	Dr	12,300	12,300		CK Traders           To Cash	Dr	12,300	12,300

Again, correct entry just copy and paste but wrong debit entry credited and wrong credit entry debited

Step 3,					Step 4,
Correct entry				x	Wrong entry
Cash             To CK Traders	Dr	12,300	12,300		Cash           To CK Traders	Dr	12,300	12,300

 Step 5,

Rectified Journal Entry

Date	Particulars		LF	Amount Dr	Amount Cr
	Cash account              To CK Traders account (Being- wrong entry, now rectified)	Dr		24,600	24,600

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PROBLEM: 3C

Following extracted information is given to you (before preparation trial balance):

Cash received from CK Traders (debtor) $/₹/Rs 5,500 has been recorded as KC Traders.

Required: Rectified journal entry

 

Given and working note:

Step 1,					Step 2,
Correct entry				÷	Wrong entry
Cash             To CK Traders	Dr	5,500	5,500		Cash           To KC Traders	Dr	5,500	5,500

Again, correct entry just copy and paste but wrong debit entry credited and wrong credit entry debited

Step 3,					Step 4,
Correct entry				x	Wrong entry
Cash             To CK Traders	Dr	5,500	5,500		KC Traders           To Cash	Dr	5,500	5,500

Step 5,

Rectified Journal Entry

Date	Particulars		LF	Amount Dr	Amount Cr
	KC Traders account              To CK Traders account (Being- wrong entry, now rectified)	Dr		5,500	5,500

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PROBLEM  AND  ANSWER

 

Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = 

Basic Problem: 3

Cash received or income wrongly recorded as cash paid or vice versa 

Following extracted information is given to you (before preparation trial balance):

(a) Cash received Rs 15,000 from Shobha (debtor) has been debited to her account.

(b) Rs 4,500 received from Manisha was posted to the debit of her account.

(c) Amount received from KK Traders Rs 13,700 was debited to its account

(d) Rs 3,000 received from Ram Krishna was posted into Krishna Ram’s account.

(e) Rent received from Prakash Rs 10,000 in cash, has been wrongly credited to his account.

Required: Rectified journal entries

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