Question

Trial Balance of Madan did not agree and he put the difference to Suspense Account. He discovered the following errors:
(a) Sales Returns book overcast by ₹ 800.
(b) Purchases returns to Sahu ₹ 2,000 were not posted to his account.
(c) Goods purchased on credit from Narula ₹ 4,000 though taken into stock, but no entry was passed in the books.
(d) Installation charges on new machinery purchased ₹ 500 were debited to sundry expenses account as ₹ 50.
(e) Rent paid for residential accommodation of Madan (the proprietor) ₹ 1,400 was debited to Rent A/c as ₹ 1,000.
Rectify the errors and prepare Suspense Account to ascertain the difference in Trial Balance.

Answer 1

One Sided Errors

Journal
Date	Particulars		L.F.	Debit Amount (Rs)	Credit Amount (Rs)
a)	Suspense A/c	Dr.		800
	To Sales Return A/c				800
	(Overcasting of Sales Return Book)
b)	Sahu’s A/c	Dr.		2,000
	To Suspense A/c				2,000
	(Goods returned to Sahu omitted to be posted)
c)	Purchases A/c	Dr.		4,000
	To Narula’s A/c				4,000
	(Goods purchased from Narula omitted to be recorded)
d)	Machinery A/c	Dr.		500
	To Sundry Expenses A/c				50
	To Suspense A/c				450
	(Installation charges on new machinery debited tp Sundry Expenses Account)
e)	Drawings A/c	Dr.		1,400
	To Rent A/c				1,000
	To Suspense A/c				400
	(Rent paid for residential accommodation of proprietor debited to Rent Account)

Suspense Account
Dr.					Cr.
Particulars		Amount (Rs)	Particulars	Amount (Rs)
Difference as per Trial Balance (Balancing Figure)		2,050	Sahu’s A/c	2,000
Sales Return A/c		800	Machinery A/c	450
			Drawings A/c	400
		2,850		2,850