A Trial Balance showed excess credit of ₹ 2,728, which were placed in a suspense account. Later on the following errors were located. Pass rectifying entries and prepare Suspense A/c.
1. ₹ 825, the total of purchase return book has been posted to the debit of sales return account.
2. Goods purchased from Suresh ₹ 1,800 recorded in Sales Book as ₹ 180.
3. An item of ₹ 328 written off as a bad debt from Ajay Sharma has not been debited to Bad Debts Account.
4. Goods purchased from X ₹ 3,500 and from Y ₹ 4,000, but were recorded in the purchase book as X ₹ 4,000 and Y ₹ 3,500.
5. Goods returned to Ramesh for ₹ 2,600 was correctly recorded in the return outward book but was wrongly posted to his account as ₹ 260.
6. A sum of ₹ 2,210 stolen by an ex-employee stand debited to Suspense A/c.
7. A sum of ₹ 500 written off as depreciation on Machinery, were not posted to Machinery account.

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Solution

One Sided Errors

Journal

Date Particulars L.F. Debit Amount (Rs) Credit Amount (Rs)

1) Suspense A/c Dr. 1,650

To Purchases Return A/c
825

To Sales Return A/c
825

(Total of Purchases Return Book posted to the debit of Sales Return Account)

2) Purchases A/c Dr. 1,800

Sales A/c Dr. 180

To Suresh’s A/c
1,980

(Purchases made from Suresh recorded as sale)

3) Bad Debts A/c Dr. 328

To Suspense A/c
328

(Amount written-off as bad debts omitted to be debited to Bad Debts Account)

4) X’s A/c Dr. 500

To Y’s A/c
500

(Amount of purchases from X and Y wrongly recorded in Purchases Book)

5) Ramesh’s A/c Dr. 2,340

To Suspense A/c
2,340

(Goods returned to Ramesh posted to his account as Rs 260 instead of Rs 2,600)

6) Loss by Theft A/c Dr. 2,210

To Suspense A/c
2,210

(Amount stolen by an ex-employee debited to Suspense Account)

7) Suspense A/c Dr. 500

To Machinery A/c
500

(Depreciation omitted to be posted to Machinery Account )

Suspense Account

Dr. Cr.

Particulars Amount (Rs) Particulars Amount (Rs)

Difference in Trial Balance (Balancing Figure) 2,728 Bad Debts A/c 328

Purchases Return A/c 825 Ramesh’s A/c 2,340

Sales Return A/c 825 Loss by Theft A/c 2,210

Machinery A/c 500

4,878 4,878

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Journal
Date	Particulars		L.F.	Debit Amount (Rs)	Credit Amount (Rs)
1)	Suspense A/c	Dr.		1,650
	To Purchases Return A/c				825
	To Sales Return A/c				825
	(Total of Purchases Return Book posted to the debit of Sales Return Account)

2)	Purchases A/c	Dr.		1,800
	Sales A/c	Dr.		180
	To Suresh’s A/c				1,980
	(Purchases made from Suresh recorded as sale)

3)	Bad Debts A/c	Dr.		328
	To Suspense A/c				328
	(Amount written-off as bad debts omitted to be debited to Bad Debts Account)

4)	X’s A/c	Dr.		500
	To Y’s A/c				500
	(Amount of purchases from X and Y wrongly recorded in Purchases Book)

5)	Ramesh’s A/c	Dr.		2,340
	To Suspense A/c				2,340
	(Goods returned to Ramesh posted to his account as Rs 260 instead of Rs 2,600)

6)	Loss by Theft A/c	Dr.		2,210
	To Suspense A/c				2,210
	(Amount stolen by an ex-employee debited to Suspense Account)

7)	Suspense A/c	Dr.		500
	To Machinery A/c				500
	(Depreciation omitted to be posted to Machinery Account )

Suspense Account
Dr.			Cr.
Particulars	Amount (Rs)	Particulars		Amount (Rs)
Difference in Trial Balance (Balancing Figure)	2,728	Bad Debts A/c		328
Purchases Return A/c	825	Ramesh’s A/c		2,340
Sales Return A/c	825	Loss by Theft A/c		2,210
Machinery A/c	500
	4,878			4,878