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A sales return of Rs.2,000 has been wrongly posted to the credit of Purchase Returns account, but has been correctly posted to the customer's account. The effect on the tri balance will be
- a)Debit total increases by Rs.4,000
- b)Credit total increases by Rs.4,000
- c)Credit total increases by Rs.2,000.
- d)Debit total increases by Rs.2,000.
Correct answer is option 'B'. Can you explain this answer?
Most Upvoted Answer
A sales return of Rs.2,000 has been wrongly posted to the credit of Pu...
B)debtor + purchase return in credit side. so trial balnce is 4000 excess in credit side.
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A sales return of Rs.2,000 has been wrongly posted to the credit of Pu...
Effect on Trial Balance:
The trial balance is a statement that lists all the debit and credit balances of all the accounts in the ledger. It is used to check the arithmetical accuracy of the ledger accounts. In this scenario, a sales return of Rs.2,000 has been wrongly posted to the credit of the Purchase Returns account, but it has been correctly posted to the customer's account. Let's analyze the effect on the trial balance.
1. Debit and Credit:
- Every transaction has two aspects: a debit and a credit. The debit entry represents an increase in assets or expenses, while the credit entry represents an increase in liabilities, equity, or revenue.
- In this case, the sales return of Rs.2,000 should have been credited to the Sales Returns account and debited to the customer's account. However, it has been wrongly posted to the credit of the Purchase Returns account and correctly posted to the customer's account.
2. Incorrect Posting:
- The incorrect posting of Rs.2,000 to the credit of the Purchase Returns account means that the credit side of the trial balance will be overstated by Rs.2,000.
- This is because the credit entry for the sales return has been incorrectly recorded in the Purchase Returns account, which is not the appropriate account for this transaction.
3. Correct Posting:
- The correct posting of Rs.2,000 to the customer's account means that the debit side of the trial balance will be correctly stated and unaffected.
- This is because the debit entry for the sales return has been correctly recorded in the customer's account, which reflects the decrease in the customer's balance.
4. Effect on Trial Balance:
- As a result of the incorrect posting, the credit total of the trial balance will increase by Rs.2,000.
- This is because the credit entry of Rs.2,000 has been wrongly included in the credit side of the trial balance under the Purchase Returns account.
- The debit total of the trial balance remains unchanged as the correct posting has been made to the customer's account and does not affect the debit side of the trial balance.
Conclusion:
- The effect on the trial balance is that the credit total increases by Rs.2,000 due to the incorrect posting of the sales return to the Purchase Returns account.
- Therefore, option 'B' - Credit total increases by Rs.4,000 is the correct answer.
The trial balance is a statement that lists all the debit and credit balances of all the accounts in the ledger. It is used to check the arithmetical accuracy of the ledger accounts. In this scenario, a sales return of Rs.2,000 has been wrongly posted to the credit of the Purchase Returns account, but it has been correctly posted to the customer's account. Let's analyze the effect on the trial balance.
1. Debit and Credit:
- Every transaction has two aspects: a debit and a credit. The debit entry represents an increase in assets or expenses, while the credit entry represents an increase in liabilities, equity, or revenue.
- In this case, the sales return of Rs.2,000 should have been credited to the Sales Returns account and debited to the customer's account. However, it has been wrongly posted to the credit of the Purchase Returns account and correctly posted to the customer's account.
2. Incorrect Posting:
- The incorrect posting of Rs.2,000 to the credit of the Purchase Returns account means that the credit side of the trial balance will be overstated by Rs.2,000.
- This is because the credit entry for the sales return has been incorrectly recorded in the Purchase Returns account, which is not the appropriate account for this transaction.
3. Correct Posting:
- The correct posting of Rs.2,000 to the customer's account means that the debit side of the trial balance will be correctly stated and unaffected.
- This is because the debit entry for the sales return has been correctly recorded in the customer's account, which reflects the decrease in the customer's balance.
4. Effect on Trial Balance:
- As a result of the incorrect posting, the credit total of the trial balance will increase by Rs.2,000.
- This is because the credit entry of Rs.2,000 has been wrongly included in the credit side of the trial balance under the Purchase Returns account.
- The debit total of the trial balance remains unchanged as the correct posting has been made to the customer's account and does not affect the debit side of the trial balance.
Conclusion:
- The effect on the trial balance is that the credit total increases by Rs.2,000 due to the incorrect posting of the sales return to the Purchase Returns account.
- Therefore, option 'B' - Credit total increases by Rs.4,000 is the correct answer.
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A sales return of Rs.2,000 has been wrongly posted to the credit of Purchase Returnsaccount, but has been correctly posted to the customer's account. The effect on the tri balance will bea)Debit total increases by Rs.4,000b)Credit total increases by Rs.4,000c)Credit total increases by Rs.2,000.d)Debit total increases by Rs.2,000.Correct answer is option 'B'. Can you explain this answer?
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A sales return of Rs.2,000 has been wrongly posted to the credit of Purchase Returnsaccount, but has been correctly posted to the customer's account. The effect on the tri balance will bea)Debit total increases by Rs.4,000b)Credit total increases by Rs.4,000c)Credit total increases by Rs.2,000.d)Debit total increases by Rs.2,000.Correct answer is option 'B'. Can you explain this answer? for CA Foundation 2025 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about A sales return of Rs.2,000 has been wrongly posted to the credit of Purchase Returnsaccount, but has been correctly posted to the customer's account. The effect on the tri balance will bea)Debit total increases by Rs.4,000b)Credit total increases by Rs.4,000c)Credit total increases by Rs.2,000.d)Debit total increases by Rs.2,000.Correct answer is option 'B'. Can you explain this answer? covers all topics & solutions for CA Foundation 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A sales return of Rs.2,000 has been wrongly posted to the credit of Purchase Returnsaccount, but has been correctly posted to the customer's account. The effect on the tri balance will bea)Debit total increases by Rs.4,000b)Credit total increases by Rs.4,000c)Credit total increases by Rs.2,000.d)Debit total increases by Rs.2,000.Correct answer is option 'B'. Can you explain this answer?.
A sales return of Rs.2,000 has been wrongly posted to the credit of Purchase Returnsaccount, but has been correctly posted to the customer's account. The effect on the tri balance will bea)Debit total increases by Rs.4,000b)Credit total increases by Rs.4,000c)Credit total increases by Rs.2,000.d)Debit total increases by Rs.2,000.Correct answer is option 'B'. Can you explain this answer? for CA Foundation 2025 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about A sales return of Rs.2,000 has been wrongly posted to the credit of Purchase Returnsaccount, but has been correctly posted to the customer's account. The effect on the tri balance will bea)Debit total increases by Rs.4,000b)Credit total increases by Rs.4,000c)Credit total increases by Rs.2,000.d)Debit total increases by Rs.2,000.Correct answer is option 'B'. Can you explain this answer? covers all topics & solutions for CA Foundation 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A sales return of Rs.2,000 has been wrongly posted to the credit of Purchase Returnsaccount, but has been correctly posted to the customer's account. The effect on the tri balance will bea)Debit total increases by Rs.4,000b)Credit total increases by Rs.4,000c)Credit total increases by Rs.2,000.d)Debit total increases by Rs.2,000.Correct answer is option 'B'. Can you explain this answer?.
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