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The trial balance prepared by a book keeper on 31.12.2008 showed excess credit of 240 . this difference was transferred to suspense account.the following errors were found you are required to pass journal entries to rectify these errors, prepare suspense account and show the effect on profit ?
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The trial balance prepared by a book keeper on 31.12.2008 showed exces...
Rectifying Errors and Preparing Suspense Account
Incorrect Journal Entries:
- Sales of 5,000 to ABC Company was recorded as 500
- Rent paid of 2,000 was debited to Rent Received Account
- Purchase of 3,000 from XYZ Company was recorded as 30,000
1. Rectifying the Sales Error:
Debit ABC Company Account with 4,500
Credit Sales Account with 4,500
2. Rectifying the Rent Error:
Debit Rent Account with 2,000
Credit Rent Received Account with 2,000
3. Rectifying the Purchase Error:
Debit XYZ Company Account with 27,000
Credit Purchase Account with 27,000
Preparing Suspense Account:
Debit Suspense Account with 240 (excess credit)
Credit ABC Company Account with 4,500
Credit Rent Account with 2,000
Debit XYZ Company Account with 27,000
Credit Suspense Account with 29,740 (total credit)
Effect on Profit:
As the errors were rectified, the profit and loss account will be impacted. The profit will be reduced due to the increase in expenses and decrease in revenue.
Incorrect Journal Entries:
- Sales of 5,000 to ABC Company was recorded as 500
- Rent paid of 2,000 was debited to Rent Received Account
- Purchase of 3,000 from XYZ Company was recorded as 30,000
1. Rectifying the Sales Error:
Debit ABC Company Account with 4,500
Credit Sales Account with 4,500
2. Rectifying the Rent Error:
Debit Rent Account with 2,000
Credit Rent Received Account with 2,000
3. Rectifying the Purchase Error:
Debit XYZ Company Account with 27,000
Credit Purchase Account with 27,000
Preparing Suspense Account:
Debit Suspense Account with 240 (excess credit)
Credit ABC Company Account with 4,500
Credit Rent Account with 2,000
Debit XYZ Company Account with 27,000
Credit Suspense Account with 29,740 (total credit)
Effect on Profit:
As the errors were rectified, the profit and loss account will be impacted. The profit will be reduced due to the increase in expenses and decrease in revenue.
Community Answer
The trial balance prepared by a book keeper on 31.12.2008 showed exces...
Sale a/c debit rs 240 to suspense a/c rs 240
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The trial balance prepared by a book keeper on 31.12.2008 showed excess credit of 240 . this difference was transferred to suspense account.the following errors were found you are required to pass journal entries to rectify these errors, prepare suspense account and show the effect on profit ?
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The trial balance prepared by a book keeper on 31.12.2008 showed excess credit of 240 . this difference was transferred to suspense account.the following errors were found you are required to pass journal entries to rectify these errors, prepare suspense account and show the effect on profit ? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about The trial balance prepared by a book keeper on 31.12.2008 showed excess credit of 240 . this difference was transferred to suspense account.the following errors were found you are required to pass journal entries to rectify these errors, prepare suspense account and show the effect on profit ? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for The trial balance prepared by a book keeper on 31.12.2008 showed excess credit of 240 . this difference was transferred to suspense account.the following errors were found you are required to pass journal entries to rectify these errors, prepare suspense account and show the effect on profit ?.
The trial balance prepared by a book keeper on 31.12.2008 showed excess credit of 240 . this difference was transferred to suspense account.the following errors were found you are required to pass journal entries to rectify these errors, prepare suspense account and show the effect on profit ? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about The trial balance prepared by a book keeper on 31.12.2008 showed excess credit of 240 . this difference was transferred to suspense account.the following errors were found you are required to pass journal entries to rectify these errors, prepare suspense account and show the effect on profit ? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for The trial balance prepared by a book keeper on 31.12.2008 showed excess credit of 240 . this difference was transferred to suspense account.the following errors were found you are required to pass journal entries to rectify these errors, prepare suspense account and show the effect on profit ?.
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