Loading....
Coupon Accepted Successfully!

 

One sided and Two sided Errors

In one sided error, accounts (those appearing in profit and loss account) is rectified via Profit and loss Adjustment Account as against suspense account & accounts (those appearing in Balance sheet) is rectified via respective account against suspense account.
 

In two sided error, wherein if the error detected which includes one aspect of account forming part of Profit & Loss account and other aspect forming part of Balance Sheet then suspense account gets cancelled and ultimate rectifying entry will be between P&L Adjustment account and respective account.


Note: If both the accounts which needs rectification is part of Balance sheet then it will be rectified via respective accounts only.

 

Illustration 8

The proprietor of a concern, while balancing his book, finds some differences in the Trial Balance. To avoid delay in the preparation of financial statements, he places the difference to “Suspense A/c” which he carried forward to the next year. In the next year, the following mistakes were discovered:

  1. Sales book was under cast by ₹ 50
  2. Purchase book was carried forward as ₹ 125 instead of ₹ 225
  3. Credit sales to Mahesh ₹ 200 was posted as ₹ 2,000 to Mahesh’s account
  4. Sales to Raju ₹ 200 was recorded in the Sales book as ₹ 2,000
  5. Purchase of a furniture of ₹ 5,000 was passed through the purchase book
  6. Sales of a furniture of ₹ 500 to Yadav was not entered anywhere

You are required to rectify the above errors:
 

Solution:
 

Date

Particulars

L.F.

Debit ()

Credit ()

(a)

Suspense A/c       Dr.

 

50

 

   To Profit and Loss Adjustment A/c

 

 

50
 

(b)

Profit and Loss Adjustment A/c        Dr.

 

100
 

 

   To Suspense A/c

 

 

100

(c)

Suspense A/c        Dr.

 

1,800

 

   To Mahesh’s A/c

 

 

1,800

(d)

Profit and Loss Adjustment A/c        Dr.

 

1,800
 

 

   To Raju’s A/c

 

 

1,800

(e)

Furniture A/c        Dr.

 

5,000

 

   To Profit and Loss Adjustment A/c

 

 

5,000

(f)

Yadav’s A/c        Dr.

 

500

 

   To Furniture A/c

 

 

500





Test Your Skills Now!
Take a Quiz now
Reviewer Name