Question

Rs. 2,750 received from Sohan was credited to Mohan as Rs. 2,750. If rectification is done before preparation of trial balance then which of the following rectification entry will be correct?

• A. Sohan A/c Dr. 2,750
  To Mohan A/c 2,750
• B. Mohan A/c Dr. 2,750 To Sohan A/c 2,750
• C. Suspense A/c Dr. 2,750
  To Mohan A/c 2,750
• D. Mohan A/c Dr. 2,750
  To Suspense A/c 2,750

Answer 1

The correct option is B Mohan A/c Dr. 2,750

To Sohan A/c 2,750

The original entry of the transaction should be

Cash A/C Dr. 2750

To Sohan A/C 2750

Instead of this correct entry the journal entry passed was

Cash A/C. Dr. 2750

To Mohan A/C. 2750

Here Mohan has been wrongly credited instead of Sohan, so to cancel the entry Mohan A/C which was originally credited now will be debited and Sohan A/C which was omitted will now be credited.