Q1. Goods sold to ram for Rs. 1000 was wrongly posted from sales day book to the debit of purchase account.(Before prep. of Trial Balance)
I know the answer "By wrong posting on Rs.1000 in credit of purchase account and By ommission of posting on Rs.1000 in the credit sales account"
But i haven''t understand the language of the question and what wrong happened in the question
Plz tell me in detail.....
Thanks in advance
WRONG ENTRY = RAMA/C ---------------------------DR
TO SALE
PURCHASE A/C ----------------DR
TO RAM
RECTIFY ENTRY = PURCHASE A/C DR 1000
TO SALE 1000
usually entry for posting on sales account is to give debit to customer and give credit to sales account. entry posting for purchase account is to credit the customer and debit the purchases account. purchase account is a asset account and hence posting the debit increases the number of purchases by 1000 which has to be decreased and sales account which is revenue account which is not posted should be increased by the amount of sales which can be done by crediting the sales account by the number of the sales. finally the customer who was credited 1000 instead of being debited 1000 (Its like saying you brought goods from me so I owe you 1000 rupees for the goods brought from me!! so first we have reduce what we owe to him by 1000 and then say that he owes us 1000) thus you debit the customer with 2000
original entries(wrong entries)
purcases Dr. 1000 ----
Ram A/c ------- 1000
correcting entries
(first reverse the wrong entry)
Ram A/c Dr. 1000 ----
purcases ------- 1000
The we write the entry which is ommitted (record sales)
Ram A/c Dr. 1000 ----
sales ------- 1000
the compound entry combining both is
Ram A/c Dr. 2000 ----
purcases ------- 1000
sales ------- 1000
But tejas and swati these are before prepartion of trial balance.....so noritification form of entry is used in it.
help me with understanding this question What question is saying...... i haven't understand the question what question is saying (use ledger with imaginary figures to help me learn)
Once again this Question is before prepartion of trial balance.
CAclubindia
