Question

A bill of Rs $20,000$ for old office furniture sold to Sethi was entered in the Sales Day Book. Which of the following rectification entry is correct?

• A. Suspense A/c Dr. $20,000$
  To Office Furniture A/c $20,000$
• B. Sales A/c Dr. $20,000$
  To Office Furniture A/c $20,000$
• C. Office Furniture A/c Dr. $20,000$
  To Suspense A/c $20,000$
• D. Office Furniture A/c Dr. $20,000$
  To Sales A/c $20,000$

Answer 1

The correct option is B Sales A/c Dr. $20,000$

To Office Furniture A/c $20,000$
Its an error of principle as capital receipt is recorded as revenue receipt. Sales of an asset has to be recorded in the respective asset not to the trading sales.

Following rectification has to be passed:

Sales A/c Dr. 20000

To Office Furniture A/c 20000