off as bad, was credited to his account. (iv) Credit sales to Manav for Rs. , was recorded through the purchases book as Rs. , .
(v) Purchases book undercast by Rs. , . (vi) Repairs on machinery Rs. , wrongly debited to Machinery account as Rs.
, . (vii) Goods returned by Nathu Rs. , were taken into stock. No entry was recorded in the books.
Solution Mahesh’s A/c Suspense A/c , To Mohit’s A/c , (Cash received from Mohit Rs. , wrongly posted to Mahesh as Rs. , , now rectified) Arnav’s A/c , To Bank A/c , To Discount Allowed A/c (Cheque received from Arnav for Rs. , in full settlement of his account of Rs.
, , dishonoured but no entry made in books, now rectified) (iii) Khanna’s A/c To Bad debts recovered A/c (Bad debts recovered wrongly credited to Khanna’s account, now rectified) (iv) Manav’s A/c , To Purchases A/c (Credit sales to Manav Rs. , wrongly recorded through purchases book as Rs. , , now rectified) (v) Purchases A/c To Suspense A/c (Purchases book undercast by Rs. , ) (vi) Repairs A/c , To Machinery A/c To Suspense A/c (Repairs on machinery Rs.
, wrongly debited to machinery account as Rs. , , now rectified) (vii) Sales Return A/c , To Nathu’s A/c , (Sales return from Nathu not recorded) Suspense Account Date Particulars Amount Date Particulars Difference as per Purchases trial balance , Repairs Mohit , Balance c/d , , , Note : Even after rectification of errors suspense account is showing a debit balance of Rs. , . This is due to non-detection of errors affecting trial balance.
Balance of suspense account will be carried forward to the next year and will be eliminated as and when all the remaining errors affecting trial balance are located. Illustration Trial balance of Kailash did not agree. He put the difference to suspense account. The following errors were discovered : Goods withdrawn by Kailash for personal use Rs.
were not recorded in the books. Discount allowed to Ramesh Rs. on receiving Rs. , from him was