Accounting Error Goods Purchased Recorded Goods Sold

  

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.

 

Goods purchased recorded as goods sold

Business goods are also known as goods, inventory and merchandise.

Sometimes business goods sold wrongly recorded as goods purchased.

It is due to hurry in work or bookkeeper does not know the actual rule to record the transaction.

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

 

PROBLEM: 5

Goods purchase wrongly recorded as goods sold

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

(a) Goods purchased from KK Traders Rs 6,570 passed through sales book as Rs 5,670.

(b) Goods purchased on credit for Rs 7,235 have been recorded as credit sales.

Required: Rectified journal entries

 

(a) Given and working note:

Step 1,					Step 2,
Correct entry				÷	Wrong entry
Purchase           To KK Traders	Dr	6,750	6,750		KK Traders           To Sales	Dr	5,670	5,670

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
Purchase                To KK Traders	Dr	6,750	6,750		Sales           To KK Traders	Dr	5,670	5,670

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(b) Given and working note:  

Step 1,					Step 2,
Correct entry				÷	Wrong entry
Purchase                To Creditor	Dr	7,235	7,235		Debtor           To Sales	Dr	7,235	7,235

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
Purchase                To Creditor	Dr	7,235	7,235		Sales           To Debtor	Dr	7,235	7,235

Step 5,

Rectified Journal Entry

Date	Particulars		LF	Amount Dr	Amount Cr
(a)	Purchase account Sales account           To KK Traders (Being- goods purchased on credit wrongly recorded as Goods sold on credit, now rectified)	Dr Dr		6,750 5,670	12,240
(b)	Purchase account Sales account           To Creditor account           To Debtor account   (Being- goods purchased credit wrongly recorded as goods sold on credit, now rectified)	Dr Dr		7,235 7,235	7,235 7,235

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PROBLEMS  AND  ANSWERS

 

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

Basic Problem: 5

Goods purchase wrongly recorded as goods sold

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

(a) Goods purchased from KK Traders Rs 4,200 passed through sales book as Rs 2,400.

(b) Purchased goods from Govind for Rs 3,000 wrongly recorded sales to Gobind.

(c) Goods purchased on credit for Rs 8,000 have been recorded as credit sales.

(d) Goods purchased from Lara Impex Rs 5,000 was wrongly entered into sales account.

Required: Rectified journal entries

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