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What will be the effect on Capital a/c after rectifying the following errors : (i) Purchase of a cycle for Rs. 3,000 was debited to conveyance A/c (fixed assets are depreciated at 10 %) (ii) Credit purchase of goods from X for Rs. 2,500 was wrongly entered in the sales book (iii) Cash received from Mr. A Rs. 1,500 was posted to the A/c of Mr. B (a) Debited with Rs. 2,300 (b) Credited with Rs. 2,300 (c) Debited with Rs. 2,700 (d) Credited with Rs. 3,800 Pls explain the solution.?
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What will be the effect on Capital a/c after rectifying the following ...
Effect on Capital A/c after Rectifying Errors
(i) Purchase of a cycle for Rs. 3,000 was debited to conveyance A/c (fixed assets are depreciated at 10 %)
(ii) Credit purchase of goods from X for Rs. 2,500 was wrongly entered in the sales book
(iii) Cash received from Mr. A Rs. 1,500 was posted to the A/c of Mr. B
Rectification of Errors
To rectify the above errors, the following entries will be passed:
(i) Purchase of a cycle for Rs. 3,000 was debited to conveyance A/c
Purchase A/c Dr. 3,000
To Conveyance A/c 3,000
(ii) Credit purchase of goods from X for Rs. 2,500 was wrongly entered in the sales book
Purchase A/c Dr. 2,500
To Sales A/c 2,500
(iii) Cash received from Mr. A Rs. 1,500 was posted to the A/c of Mr. B
Mr. A A/c Dr. 1,500
To Mr. B A/c 1,500
Effect on Capital A/c
The effect on Capital A/c will be as follows:
(a) Debited with Rs. 2,300
If the errors are rectified as given above, the effect on Capital A/c will be a debit of Rs. 2,300. This is because the purchase of a cycle was wrongly debited to Conveyance A/c, which led to an understatement of fixed assets and an overstatement of expenses. By rectifying this error, the Capital A/c will be debited with Rs. 3,000 (purchase of cycle) - Rs. 300 (depreciation) = Rs. 2,700. Additionally, the credit purchase of goods from X was wrongly entered in the sales book, which led to an understatement of purchases and an overstatement of sales. By rectifying this error, the Capital A/c will be debited with Rs. 2,500 (purchase of goods) = Rs. 2,500. Therefore, the total debit to Capital A/c will be Rs. 2,700 + Rs. 2,500 = Rs. 5,200. However, as the cash received from Mr. A was posted to the A/c of Mr. B, there will be a credit of Rs. 2,900 (Rs. 1,500 + Rs. 1,400) to Capital A/c. Therefore, the net debit to Capital A/c will be Rs. 5,200 - Rs. 2,900 = Rs. 2,300.
(b) Credited with Rs. 2,300
This option is incorrect as all the errors have been rectified by passing the appropriate journal entries. Therefore, there will be no credit to Capital A/c.
(c) Debited with Rs. 2,700
This option is incorrect as the debit to Capital A/c will be Rs. 2,300 as explained in option (a).
(d) Credited with Rs. 3,800
This option is incorrect as there will be no credit to Capital A/c.
(i) Purchase of a cycle for Rs. 3,000 was debited to conveyance A/c (fixed assets are depreciated at 10 %)
(ii) Credit purchase of goods from X for Rs. 2,500 was wrongly entered in the sales book
(iii) Cash received from Mr. A Rs. 1,500 was posted to the A/c of Mr. B
Rectification of Errors
To rectify the above errors, the following entries will be passed:
(i) Purchase of a cycle for Rs. 3,000 was debited to conveyance A/c
Purchase A/c Dr. 3,000
To Conveyance A/c 3,000
(ii) Credit purchase of goods from X for Rs. 2,500 was wrongly entered in the sales book
Purchase A/c Dr. 2,500
To Sales A/c 2,500
(iii) Cash received from Mr. A Rs. 1,500 was posted to the A/c of Mr. B
Mr. A A/c Dr. 1,500
To Mr. B A/c 1,500
Effect on Capital A/c
The effect on Capital A/c will be as follows:
(a) Debited with Rs. 2,300
If the errors are rectified as given above, the effect on Capital A/c will be a debit of Rs. 2,300. This is because the purchase of a cycle was wrongly debited to Conveyance A/c, which led to an understatement of fixed assets and an overstatement of expenses. By rectifying this error, the Capital A/c will be debited with Rs. 3,000 (purchase of cycle) - Rs. 300 (depreciation) = Rs. 2,700. Additionally, the credit purchase of goods from X was wrongly entered in the sales book, which led to an understatement of purchases and an overstatement of sales. By rectifying this error, the Capital A/c will be debited with Rs. 2,500 (purchase of goods) = Rs. 2,500. Therefore, the total debit to Capital A/c will be Rs. 2,700 + Rs. 2,500 = Rs. 5,200. However, as the cash received from Mr. A was posted to the A/c of Mr. B, there will be a credit of Rs. 2,900 (Rs. 1,500 + Rs. 1,400) to Capital A/c. Therefore, the net debit to Capital A/c will be Rs. 5,200 - Rs. 2,900 = Rs. 2,300.
(b) Credited with Rs. 2,300
This option is incorrect as all the errors have been rectified by passing the appropriate journal entries. Therefore, there will be no credit to Capital A/c.
(c) Debited with Rs. 2,700
This option is incorrect as the debit to Capital A/c will be Rs. 2,300 as explained in option (a).
(d) Credited with Rs. 3,800
This option is incorrect as there will be no credit to Capital A/c.
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What will be the effect on Capital a/c after rectifying the following errors : (i) Purchase of a cycle for Rs. 3,000 was debited to conveyance A/c (fixed assets are depreciated at 10 %) (ii) Credit purchase of goods from X for Rs. 2,500 was wrongly entered in the sales book (iii) Cash received from Mr. A Rs. 1,500 was posted to the A/c of Mr. B (a) Debited with Rs. 2,300 (b) Credited with Rs. 2,300 (c) Debited with Rs. 2,700 (d) Credited with Rs. 3,800 Pls explain the solution.?
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What will be the effect on Capital a/c after rectifying the following errors : (i) Purchase of a cycle for Rs. 3,000 was debited to conveyance A/c (fixed assets are depreciated at 10 %) (ii) Credit purchase of goods from X for Rs. 2,500 was wrongly entered in the sales book (iii) Cash received from Mr. A Rs. 1,500 was posted to the A/c of Mr. B (a) Debited with Rs. 2,300 (b) Credited with Rs. 2,300 (c) Debited with Rs. 2,700 (d) Credited with Rs. 3,800 Pls explain the solution.? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about What will be the effect on Capital a/c after rectifying the following errors : (i) Purchase of a cycle for Rs. 3,000 was debited to conveyance A/c (fixed assets are depreciated at 10 %) (ii) Credit purchase of goods from X for Rs. 2,500 was wrongly entered in the sales book (iii) Cash received from Mr. A Rs. 1,500 was posted to the A/c of Mr. B (a) Debited with Rs. 2,300 (b) Credited with Rs. 2,300 (c) Debited with Rs. 2,700 (d) Credited with Rs. 3,800 Pls explain the solution.? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for What will be the effect on Capital a/c after rectifying the following errors : (i) Purchase of a cycle for Rs. 3,000 was debited to conveyance A/c (fixed assets are depreciated at 10 %) (ii) Credit purchase of goods from X for Rs. 2,500 was wrongly entered in the sales book (iii) Cash received from Mr. A Rs. 1,500 was posted to the A/c of Mr. B (a) Debited with Rs. 2,300 (b) Credited with Rs. 2,300 (c) Debited with Rs. 2,700 (d) Credited with Rs. 3,800 Pls explain the solution.?.
What will be the effect on Capital a/c after rectifying the following errors : (i) Purchase of a cycle for Rs. 3,000 was debited to conveyance A/c (fixed assets are depreciated at 10 %) (ii) Credit purchase of goods from X for Rs. 2,500 was wrongly entered in the sales book (iii) Cash received from Mr. A Rs. 1,500 was posted to the A/c of Mr. B (a) Debited with Rs. 2,300 (b) Credited with Rs. 2,300 (c) Debited with Rs. 2,700 (d) Credited with Rs. 3,800 Pls explain the solution.? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about What will be the effect on Capital a/c after rectifying the following errors : (i) Purchase of a cycle for Rs. 3,000 was debited to conveyance A/c (fixed assets are depreciated at 10 %) (ii) Credit purchase of goods from X for Rs. 2,500 was wrongly entered in the sales book (iii) Cash received from Mr. A Rs. 1,500 was posted to the A/c of Mr. B (a) Debited with Rs. 2,300 (b) Credited with Rs. 2,300 (c) Debited with Rs. 2,700 (d) Credited with Rs. 3,800 Pls explain the solution.? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for What will be the effect on Capital a/c after rectifying the following errors : (i) Purchase of a cycle for Rs. 3,000 was debited to conveyance A/c (fixed assets are depreciated at 10 %) (ii) Credit purchase of goods from X for Rs. 2,500 was wrongly entered in the sales book (iii) Cash received from Mr. A Rs. 1,500 was posted to the A/c of Mr. B (a) Debited with Rs. 2,300 (b) Credited with Rs. 2,300 (c) Debited with Rs. 2,700 (d) Credited with Rs. 3,800 Pls explain the solution.?.
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