Home » Accounting Explanation » Rectification of Errors - Errors not affecting Trial Balance agreement


Example

1) Sale of building for $30,000 was recorded in sales account

2) Goods amounting to $500 returned by Mr. A were entered in Mr.B's account mistakenly

3) Purchase of goods for $1000 was never entered in the books of accounts

4) A cash recipt of $1000 from Mr.Z was recorded as $500 in the books

5) A payment of $1000 made to Mr. Z was recorded on the debit side of the cash book and credited to Mr. Z A/C

6) The Repair of Machinery worth $200 was charged to Machinery account.

7) G Man was credited with the check received from Mr. Z. (Hint: G man and Mr. Z are Debtors)

Required: Pass some rectifying double entries to correct the errors

Solution:

1) Sale of building for $30,000 was recorded in sales account

The wrong entry that we have made by mistake

  DESCRIPTION DEBIT CREDIT



   Cash   $30,000



                    Sales   $30,000




The right entry that we should have passed

  DESCRIPTION DEBIT CREDIT



   Cash   $30,000



                    Building   $30,000




The rectifying entry that will correct the error

  DESCRIPTION DEBIT CREDIT



   Sales   $30,000



                    Building   $30,000






2) Goods amounting to $500 returned by Mr. A were entered in Mr.B's account mistakenly

The wrong entry that we have made by mistake

  DESCRIPTION DEBIT CREDIT



   Sales return   $500



                    Mr. B   $500




The right entry that we should have passed

  DESCRIPTION DEBIT CREDIT



   Sales return   $500



                    Mr. A   $500




The rectifying entry that will correct the error

  DESCRIPTION DEBIT CREDIT



   Mr. B   $500



                    Mr. A   $500





3) Purchase of goods for $1000 was never entered in the books of accounts

The rectifying entry that will correct the error

  DESCRIPTION DEBIT CREDIT



   Purchases   $1000



                    Cash   $1000






4) A cash recipt of $1000 from Mr. Z was recorded as $500 in the books

The wrong entry that we have made by mistake

  DESCRIPTION DEBIT CREDIT



   Cash   $500



                    Mr. Z   $500




The right entry that we should have passed

  DESCRIPTION DEBIT CREDIT



   Cash   $1000



                    Mr. Z   $1000




The rectifying entry that will correct the error

  DESCRIPTION DEBIT CREDIT



   Cash   $500



                    Mr. Z   $500





5) A payment of $1000 made to Mr. Z was recorded on the debit side of the cash book and has Credited to Mr. Z account

The wrong entry that we have made by mistake

  DESCRIPTION DEBIT CREDIT



   Cash   $1000



                    Mr. Z   $1000




The right entry that we should have passed

  DESCRIPTION DEBIT CREDIT



   Mr. Z   $1000



                    Cash   $1000




The rectifying entry that will correct the error

  DESCRIPTION DEBIT CREDIT



   Mr. Z   $2000



                    Cash   $2000





6) The Repair of Machinery worth $200 was charged to Machinery account.

The wrong entry that we have made by mistake

  DESCRIPTION DEBIT CREDIT



   Machinery   $200



                    Cash   $200




The right entry that we should have passed

  DESCRIPTION DEBIT CREDIT



   Repair expenses   $200



                    Cash   $200




The rectifying entry that will correct the error

  DESCRIPTION DEBIT CREDIT



   Repair expenses   $200



                    Machinery   $200






7) G Man was credited with the $500 check received from Mr. Z. (Hint: G man and Mr. Z are Debtors)

The wrong entry that we have made by mistake

  DESCRIPTION DEBIT CREDIT



   Bank   $500



                    G man   $500




The right entry that we should have passed

  DESCRIPTION DEBIT CREDIT



   Bank   $500



                    Mr. Z   $500




The rectifying entry that will correct the error

  DESCRIPTION DEBIT CREDIT



   G man   $500



                    Mr. Z   $500