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.
Purchase return means goods goes out. It is returned to suppliers.
Sales return means goods comes in. it is returned from customers.
Sometimes bookkeeper or accountant does error to record these transactions.
Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු =
PROBLEM: 6
Following extracted information is given to you (before preparation trial balance):
(a) Returned inward of Rs 3,570 were wrongly recorded into purchase account.
(b) Rs 6,575 being purchase returns to Eshna was posted to the purchase book.
Required: Rectified journal entries
(a) Given and working note:
Step 1, |
|
Step 2, |
||||||
Correct entry |
÷ |
Wrong entry |
||||||
Sales return To Debtor |
Dr
|
3,570 |
3,570 |
|
Purchase To Creditor |
Dr
|
3,570 |
3,570 |
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 |
||||||
Sales return To Debtor |
Dr
|
3,570 |
3,570 |
|
Creditor To Purchase |
Dr
|
3,570 |
3,570 |
###########
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###########
(b) Given and working note:
Step 1, |
|
Step 2, |
||||||
Correct entry |
÷ |
Wrong entry |
||||||
Eshna To Purchase return |
Dr
|
6,575 |
6,575 |
|
Purchase To Eshna |
Dr
|
6,575 |
6,575 |
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 |
||||||
Eshna To Purchase return |
Dr
|
6,575 |
6,575 |
|
Eshna To Purchase |
Dr
|
6,575 |
6,575 |
Step 5,
Rectified Journal Entry
Date |
Particulars |
|
LF |
Amount Dr |
Amount Cr |
(a) |
Sales return account Creditor account To Debtor account To Purchase account (Being- sales return wrongly recorded as goods purchased on credit, now rectified) |
Dr Dr
|
|
3,570 3,570 |
3,570 3,570 |
(b) |
Eshna’s account To Purchase return account To Purchase account (Being- purchase return to Eshna wrongly recorded as Goods purchased, now rectified) |
Dr
|
|
13,150
|
6,575 6,575 |
********
PROBLEMS AND ANSWERS |
Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු =
Basic Problem: 6
Purchase and sales return
Following extracted information is given to you (before preparation trial balance):
(a) Returned inward of Rs 2,145 were wrongly recorded into purchase account.
(b) Rs 7,654 being purchase returns to Eliza was posted to the purchase book.
(c) Sales return from BC Traders of Rs 15,257 was recorded as sales account
(d) Returned from customers Rs 7,384 recorded as return to supplier
Required: Rectified journal entries
***********
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