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Goods of the value of ₹2,500 returned by a customer were entered in the Sales day Book and posted therefrom to the credit of his account. rectification entry?
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Goods of the value of ₹2,500 returned by a customer were entered in th...
Rectification entry for goods returned by a customer
- Firstly, it is important to rectify the error made in the Sales day Book where the returned goods were incorrectly entered as a sale.
- The rectification entry will reverse the effect of the original entry and correctly account for the returned goods.
Determine the correct entry
- The correct entry should debit the Sales account and credit the customer's account for the value of the returned goods, which is ₹2,500 in this case.
- This will reflect the true nature of the transaction and ensure that the books accurately represent the financial position of the business.
Journal entry
- The rectification entry will be as follows:
- Debit Sales Account ₹2,500
- Credit Customer's Account ₹2,500
Explanation
- By debiting the Sales account, we are reducing the sales revenue by the amount of the returned goods, which were incorrectly included in the sales figure.
- By crediting the customer's account, we are acknowledging the return and reducing the amount owed by the customer accordingly.
- This rectification entry ensures that the financial statements are corrected and accurately reflect the impact of the returned goods on the business's finances.
- Firstly, it is important to rectify the error made in the Sales day Book where the returned goods were incorrectly entered as a sale.
- The rectification entry will reverse the effect of the original entry and correctly account for the returned goods.
Determine the correct entry
- The correct entry should debit the Sales account and credit the customer's account for the value of the returned goods, which is ₹2,500 in this case.
- This will reflect the true nature of the transaction and ensure that the books accurately represent the financial position of the business.
Journal entry
- The rectification entry will be as follows:
- Debit Sales Account ₹2,500
- Credit Customer's Account ₹2,500
Explanation
- By debiting the Sales account, we are reducing the sales revenue by the amount of the returned goods, which were incorrectly included in the sales figure.
- By crediting the customer's account, we are acknowledging the return and reducing the amount owed by the customer accordingly.
- This rectification entry ensures that the financial statements are corrected and accurately reflect the impact of the returned goods on the business's finances.
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Goods of the value of ₹2,500 returned by a customer were entered in the Sales day Book and posted therefrom to the credit of his account. rectification entry?
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Goods of the value of ₹2,500 returned by a customer were entered in the Sales day Book and posted therefrom to the credit of his account. rectification entry? 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 Goods of the value of ₹2,500 returned by a customer were entered in the Sales day Book and posted therefrom to the credit of his account. rectification entry? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Goods of the value of ₹2,500 returned by a customer were entered in the Sales day Book and posted therefrom to the credit of his account. rectification entry?.
Goods of the value of ₹2,500 returned by a customer were entered in the Sales day Book and posted therefrom to the credit of his account. rectification entry? 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 Goods of the value of ₹2,500 returned by a customer were entered in the Sales day Book and posted therefrom to the credit of his account. rectification entry? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Goods of the value of ₹2,500 returned by a customer were entered in the Sales day Book and posted therefrom to the credit of his account. rectification entry?.
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