Posting of Wrong Amount

Q. Prepare Trading and Profit and Loss account. and balance sheet on M/s Royal Traders from the following balances as on March 31, 2011.
$\begin{array}{cccc}\text{Debit Balances}& \text{Amt. (Rs.)}& \text{Credit Balances}& \text{Amt. (Rs.)}\\ \text{Stock}& 20,000& \text{Sales}& 2,45,000\\ \text{Cash}& 5,000& \text{Creditors}& 10,000\\ \text{Bank}& 10,000& \text{Bills Payable}& 4,000\\ \text{Carriage on Purchase}& 1,500& \text{Capital}& 2,00,000\\ \text{Purchase}& 1,90,000& & \\ \text{Drawings}& 9,000& & \\ \text{Wages}& 55,000& & \\ \text{Machinery}& 1,00,000& & \\ \text{Debtors}& 27,000& & \\ \text{Postage}& 300& & \\ \text{Sundry Expenses}& 1,700& & \\ \text{Rent}& 4,500& & \\ \text{Furniture}& 35,000& & \end{array}$
Closing Stock Rs. 8, 000.

Q.

The following are the extracts from the trial balance of M/s Bhola and Sons as on March 31, 2011.
$\begin{array}{ccc}\text{Account Title}& \text{Amt. (Dr.)}& \text{Amt. (Cr)}\\ \text{Opening Stock}& 2,00,000& \\ \text{Purchase}& 8,10,000& \\ \text{Sales}& & 10,10,000\\ & \underset{–}{\overline{10,10,000}}& \underset{–}{\overline{10,10,000}}\end{array}$
(only relevant items)
Closing stock as on date was valued at Rs. 3, 00, 000.
You are required to record the necessary journal entries and show how the above items will appear in the Trading and Profit and Loss account and balance sheet of M/s Bhola and Sons.

Q. State whether the following statements are ‘True or False”.

1) Ledger is known as the book of original entry.
2) Narration is not necessary in ledger.
3) All accounts are closed down at the end of the accounting year.
4) Recording of a transaction in Journal is called posting.
5) Balance of personal account is brought down for the next year.
6) All transactions are recorded directly in ledger.
7) Ledger Folio and index is necessary for ledger.
8) Ledger posting is not necessary for Journal Proper.
9) Ledger Folio is recorded in Journal.
10) Ledger posting is made before passing Journal entry.

Q. Bank charges Rs. 100, shown in the Pass Book had not been entered in the Cash Book. Whai is the treatment in BRS if bank book balance is the starting point?

1. Added
2. Deducted

Q.

As an accountant for a company, you are disappointed to learn that the totals in your new trial balance are not equal. After going through a careful analysis, you have discovered only one error. Specifically, the balance of the Office Equipment account has a debit balance of Rs. 15, 600 on the trial balance. However, you have figured out that a correctly recorded credit purchase of pen drive for Rs. 3, 500 was posted from the journal to the ledger with an Rs. 3, 500 debit to Office Equipment and another Rs. 3, 500 debit to creditor's accounts. Answer each of the following questions and present the amount of any misstatement

(a) Is the balance of the office equipment account overstated, understated or correctly stated in the trial balance?

(b) Is the balance of the creditor's account overstated, understated or correctly stated in the trial balance?

(c) Is the debit column total of the trial balance overstated, understated or correctly stated?

(d) Is the credit column total of the trial balance overstated, understated or correctly stated?

(e) If the debit column total of the trial balance is Rs. 2, 40, 000 before correcting the error, what is the total of credit column?

Q.

Write the word, term, phrase, Which can substitute each of the following statement.

1) Transfer of a Journal entry from Journal to ledger.
2) Total of Debit side of an A/c is more than total of Credit side of an A/c.
3) Page number of ledger.
4) A book of an account in which all ledger accounts are maintained.
5) Left hand side of an account.
6) Right hand side of an account.
7) Types of accounts which are not balanced but transferred to Trading A/c or Profit & Loss A/c.
8) Bound book of accounts.
9) An account where total of Purchases Book is posted.
10) A statement of accounts prepared from the balances of ledger account.

Q.

Purchased goods of Rs. 2, 400 from Simran and is correctly entered in the purchases book but posted to the credit of her account in the ledger as Rs. 3, 400. Will this error create a difference in the trial balance or not?

1. No, there will be no difference

2. Yes, a difference of Rs. 1, 000

3. Yes, a difference Rs. 2, 400

4. Yes, a difference of Rs. 3, 400

Q.

From the following Trial Balance of Kalyani, you are required to prepare Trading Profit & Loss Account for the year ended 31st March, 2010 and Balance Sheet as on that date.

Trial Balance as on 31st March, 2010
Particulars	Debit Amount Rs	Credit Amount Rs
Capital		90, 000
Drawings	3, 000
Stock on 1-4-2009	45, 000
Octroi duty	800
Purchases & Sales	2, 00, 000	3, 12, 000
Returns	6, 000	2, 000
Salaries	10, 000
Carriage outward	1, 400
Wages	14, 000
Insurance	2, 000
Discount received		600
Postage	800
Debtors and Creditors	60, 000	64, 000
Furniture	35, 000
Cash in hand	10, 000
Machinery	80, 000
Rent & Taxes	6, 000
Printing & stationery	2, 000
Bank Overdraft		7, 400
Total	4, 76, 000	4, 76, 000

Q. Answer in one sentence only :

Write the meaning of imprest system of petty cash book.

Q.

The Trial Balance shows a difference of Rs 1339 in the debit column and is made to agree by putting this difference against a suspense account later the following errors were discovered, Rectify them and prepare a suspense account.

1) Goods sold to Deepak worth Rs 550 on credit this was recorded in sales but not posted in the ledger to Deepak account.
2) Goods worth Rs 325 were returned by Bhat. The amount was credited to his account but was not entered in the sales Return Book.
3) Nandu paid Rs 760 to us, but their account was credited for Rs 706.
4) Goods worth Rs 225 purchased from Subhash were wrongly entered in the sales Book.
5) An amount of Rs 320 owned by Kishor was omitted from the list of Sundry Debtors.
6) The Purchase Book was overcast by Rs 252.

Q.

A sale of Rs. 5250 on credit entered in the Sales Book as Rs.2, 550. The effect of this mistake on the Gross Profit shall be ___ .

1. No effect on the Gross Profit

2. Increase in Gross Profit by Rs 2, 700

3. Decrease in Gross Profit by Rs 2, 700

4. Increase in Gross Profit by Rs 5, 250

Q.

Following is the Trial Balance of M/s Duppar, you are required to prepare Trading Profit & Loss Account for the year ending 31st March, 2011 and Balance Sheet as on that date.

Trial Balance as on 31st March, 2011
Particulars	Debit Amount Rs	Credit Amount Rs
Opening Stock	40, 000
Purchases and Sales	1, 20, 000	2, 00, 000
Wages	12, 000
Carriage inward	2, 500
Salaries	10, 000
Printing and stationery	3, 500
Machinery	40, 000
Carriage outward	2, 000
Office expenses	4, 500
Land and Buildings	35, 000
Furniture	10, 000
Bank balance	5, 500
Sundry Debtors and Creditors	20, 000	18, 000
Bad Debts	500
Rent and Taxes	1, 500
Advertisement	1, 000
Capital		70, 000
Commission received		2, 000
Bills Payable		5, 000
10% Bank Loan (Taken on 1-10-2010)		20, 000
Drawings	7, 000
Total	3, 15, 000	3, 15, 000

Q.

Rectify the following errors by opening a suspense account credit side of the trial balance was cast short and the difference of trial account.

1) Paid Rs 700 to Nishigandha was debited to pritigantha account.
2) Total of sales book cast short by Rs 175.
3) Purchased goods casting Rs 690 on credit from shrawani was recorded in the purchase book but failed to credit shrawani account.
4) Total of purchase book was Overcast by Rs 95.
5) Received Rs 548 from Firoz on account was correctly recorded in cash account but Firoz account was credited by Rs 584.
6) Paid Advertisement Expenses amounted to Rs 350 was wrongly recorded twice in the Advertisement account.

Q.

A suspense account of a business shows a debit balance of Rs 1075. Rectify the following errors and bring the suspense account to zero balance.

1) Machinery account has been under balanced by Rs 950.
2) Our debtor Hari’s account has been balanced by excess amount Rs 75.
3) The total of purchase book is over cast by Rs 125.
4) The total of sales return book is under cast by Rs 205.
5) Cash column of the cash book has been balanced short by Rs 120.

Q.

Trial Balance includes an item as Suspense account on the debit side at Rs 109. On investigation. You find the following errors.

1) Sales day book has been overcast by Rs 250.
2) Goods returned by Ram Rs 75 has been posted to his personal account only.
3) Goods worth Rs 160 returned to Ram posted to his personal account only.
4) Shakharam paid us a cheque of Rs 95 has been posted to his account as Rs 59.
5) Paid cheque to Sardar Rs 130 has been posted to his account only.
6) Rs 700 were due from K. Ashwin written off as bad debts. After wards a final dividend of Rs 150 received from his estate has not been posted.
Give journal entries to rectify the above, and also show now the suspense account will appear.

Q.

The Trial Balance of Govindrao is short of credit by Rs 1250. This difference is shown as ‘Suspense’ account in the credit column of the Trial Balance. on scrutiny of accounts the following errors were traced out.

1) The purchase journal was overcast by Rs 250.
2) The periodical total of the sales book was cast short by Rs 1500.
3) The total of return inward book for the month was added short by Rs 100.
4) The total receipt side of the cash book was taken short by Rs 300 with result that cash balance was shown as Rs 1700 instead of Rs 2000.
5) Commission of Rs 100 received from Trupti was credited both to Commission account and to Trupti’s account.

Q.

how to make journal then ledger trading a/c p/l a/c balance sheet

Q.

what is the difference between c/d and b/d in ledger?

Q. Answer in one sentence only :

Who is a payee?

Q.

Analyse the effect of each transaction and prove that the accounting equation always remains balancec:

1. Introduced Rs 800000 as cash and Rs 50000 by stock.

2. Purchased plant for Rs 300000 by paying Rs 15000 in cash and balance at a later date.

3. Deposited Rs 600000 into the bank.

4. Purchased office furniture for Rs 100000 and made payment by cheque.

5. Purchased goods worth Rs 80000 for cash and Rs 35000 on credit.

6. Goods amounting to Rs 45000 was sold for Rs 60000 on cash basis.

7. Goods costing Rs 80000 was sold for Rs 125000 on credit basis.

8. Cheque issued to the supplier of the goods worth Rs 35000.

9. Cheque received from customer amounting to Rs 75000.

10 Withdrawn by the owner for personal use Rs 25000.