Accounting Error Over Recorded And Under Recorded

 

Two sided error after 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.

On after preparing trial balance, we should write ‘suspense’ in place of ‘cash’ on final rectified journal entry,

 

Over recorded and under recorded

Over record means amount write more than actual transaction.

Under record means amount write less than actual transaction.

 

PROBLEM: 10

Under or over recorded

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

(a) Cash paid to Rina Rs 2,987 was posted Rs 2,897.

(b) Cash paid to Kanchan Rs 2,345 has been debited to her account by Rs 3,245.

Required: Rectified journal entries

 

(a) Given and working note:

Step 1,				÷	Step 2,
Correct entry					Wrong entry
Rina           To Cash	Dr	2,987	2,987		Rina           To Cash	Dr	2,897	2,897

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
Rina           To Cash	Dr	2,987	2,987		Cash           To Rina	Dr	2,897	2,897

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 (b) Given and working note:  

Step 1,				÷	Step 2,
Correct entry					Wrong entry
Kanchan                 To Cash	Dr	2,345	2,345		Knachan           To Cash	Dr	3,245	3,245

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
Kanchan               To Cash	Dr	2,345	2,345		Cash           To Kanchan	Dr	3,245	3,245

Step 5,

Rectified Journal Entry

Date	Particulars		LF	Amount Dr	Amount Cr
(a)	Rina’s account           To Suspense account (Being- cash paid to Rina over recorded, now rectified)	Dr		90	90
(b)	Suspense account           To Kanchan (Being- cash paid to Kanchan under recorded, now rectified)	Dr		900	900

 

Keep in mind

After preparation trial balance, if there is cash on step 5 in working note, we must write suspense in place of cash.

 

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PROBLEMS  AND  ANSWERS

 

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

Basic Problem: 10

Under or over recorded

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

(a) Cash paid to Ritika Rs 3,500 was posted Rs 5,300.

(b) Cash paid to Kumar Rs 750 has been debited to his account by Rs 570.

(c) Goods sold to Rekha Rs 675 was posted as Rs 567 in account.

(d) Cash paid to Rohan Rs 3,000 has been debited to his account only Rs 300.

(e) Depreciation of Rs 4,500 has been wrongly posted Rs 5,400 in machinery account.

(f) Rs 550 received from Manju was posted to her account Rs 5,500.

Required: Rectified journal entries

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