Fyjc Recording Lectures Word File Lecture Wise

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FYJC RECORDING LECTURES WORD FILE LECTURE WISE

RECTIFICATION OF ERRORS (TOTAL TIME :5 HOURS 13 MINS)

LEC1.THEORY (1 HOUR 35 MINS)

LEC2.Rectify the following errors. (24 MINS)

1. Purchase of table fan worth Rs 1,000 for cash was debited to purchase a/c

2. Goods amounting to Rs 500 had been returned by a customer but no entry in respect thereof was made in the books.

Repairs of office Car valued Rs 750 were debited to the office Car a/c

4. Goods returned to S.Sen valued Rs 75 were debited to

P.Sen's a/c.

5. An office Typewriter purchased on credit for Rs 5,000 has been passed through the Purchase book.

6. 20 shares of A Ltd. purchased for cash @ Rs 50 each and Brokerage paid Rs 20/- entry not recorded in the books.

LEC3.Pass rectification entries for the following transactions:- (27 MINS)

(a) A builder's bill for Rs.4,600/- for erection of a small shed was debited to repairs account.

(b) Repairs to plant amounting to Rs.900/- had been charged to plant and machinery account.

(c) Wages paid to the firm's workmen for making certain additions to machinery amounting to Rs.340/- were debited to Wages Account.

(d) A cheque for Ra.750/- received from S. Desai was credited to the account of R. Ram.

(e) Goods to the value of Rs.700/- returned by X were included in the closing stock but no entry was made in the books.

(f) Goods costing Rs.2,000/- were purchased for various members of the staff and the cost was included in "purchases". A similar amount was deducted from the salaries of the staff members concerned and the net payments of them debited to salaries account.

(g)A bill of exchange (received from Hari) for Rs.3,000/- had been returned by the bank, with whom it had been discounted, as dishonored and had been credited to bank account and debited to Bills Receivable Account. [C.A. Entrance D 83]

LEC 4Show by means of Journal entries how the following matters should be adjusted when preparing the annual accounts of a firm for the year ended 30th Sept. (31 MINS)

a) Goods sold and recorded as sales for Rs 4,000 were packed and the invoice for them sent to the customers. Stock taking intervened and the parcel of goods was not dispatched but was included in stock in hand.

b) Several employees took their salary in advance in the month of Sept 1984, which was payable to them in Oct. 1984 amounting to Rs 2,500.

c) A purchase was made for a staff member of Rs 1,000 and the cost was included in purchases. A deduction of similar amount was made from his salary and the net payment to him posted to salaries account.

d) Wages Paid to the firm's own workmen for making certain additions to machinery amounting to Rs 750 were posted to wages account.

e) A Dishonoured bill receivable for Rs 500 returned by the Bank with whom it had been discounted, and had been credited to Bank A/c and debited to Bills Receivable A/c

f) A cheque amounting to Rs 270 received from a customer Mrx was dishonoured. the returned cheque was correctly entered int eh Cash Book but was posted therefrom to Allowances A/c.

g) A duplicate invoice for a purchase of machinery costing Rs 10,000 was erroneously passed again and entered into the books.

h) A sum of Rs 1,000 drawn by the proprietor was debited to Travelling Expenses. (C.A.ENTRANCE DEC 84)

LEC 5On 31st. March, 1989, while balancing the books of ShriRamdas, they did not agree. The difference in trial balance amounting to Rs.783/- was debited to Suspense Account. Later, the following errors were noticed. Give the journal entries for rectification and prepare the Suspense Account. (30 MINS)

(a) The total of purchase book of March 1989 has been undercast by Rs.300/-.

(b) Rs.228/- paid for repairing the machinery has been debited to machinery account.

(d) The sales book of Rs.1,200/- to Mr. David has been passed through purchases book.

(e) Cash Rs.117/- received from Shri M. Das, through entered in the cash book, has not been posted to Shri M das's Account.

(f)Goods returned by Mr. N. Navin Rs.225/- have been entered in the returns outward book. However, Mr. N. Navin's account is correctly posted. [C.A. Entrance N 89]

LEC6. The trail balance of ShriGovind shows a difference of Rs.400/- the credit side being in excess. The difference is subsequently found due to the following mistakes:(30 MINS)

(a) The purchase of an office table costing Rs.2,000/- had been passed through the purchase day book.

(b) A motor car had been purchased for Rs.3,400/-. Cash had been correctly credited, but the motor car account had been debited with Rs.3,140/- only.

(c) Interest on deposits received Rs.60/- had been correctly recorded in cash book but had not been credited to the `Interest' account.

(d) The balance in the account of Mr. Rahim Rs.100/- had been written off as bad but no other account had been debited.

(e)A debit balance of Rs.100/- on the personal account of Mr. John (correctly shown in the ledger) has been omitted when extracting a trial balance.

Give the necessary entries for rectification and show the Suspense Account. [C.A. Entrance M 90]

LEC7. (23 MINS)

In taking out a trial balance a book keeper finds that the debit exceeds by Rs. 41/- Being

desirous of closing his books he places the difference to a newly opened Suspense A/c. After recording the difference in Suspense A/c he discovers that:-

(a)A sum of Rs. 83/- received from X was posted to his debit as Rs. 38/-

(b)Rs. 62/- written off as depreciation on furniture has not been posted to depreciation A/c.

(c)Rs. 1,000/- paid for a new furniture has been charged to repairs.

(d)A discount of Rs. 21/- allowed to a customer has been credited to his A/c as Rs. 20/-

(e)The total of the sales return book has been added one rupee short.

(f)An item of sale of Rs. 68/- was posted as Rs. 86/- in the sales A/c.

You are required to give the journal entries for rectification of the above and to show the Suspense A/c.

LEC8.The Trial Balance of Green and Co. as on 30th June, 1987 shows a difference of Rs.8,323 the debit side being in excess of the credit side. This difference was placed in Suspense A/c while closing the books. The following errors were subsequently noticed :(23 MINS)

a) Returns outward book was undercast by Rs 909 on 28th June 1987.

b)Repairs to plant and machinery amounting to Rs. 1,100 was debited to plant and machinery account on 9th June, 1987.

c) Advance of Rs 1,001 given to one of the suppliers Mr X on 20th May 1987 was entered correctly in the cash book but was posted in his account on the credit side.

d) A cheque for Rs 929 deposited in the Bank on29th May, 1987 was wrongly entered in cash book as Rs 9,229 though the correct amount was posted in the account of the customer.

e) Closing Stock as on 30th June, 1986 was Rs 95,700 but the same wrongly carried forward a Rs 97,500 in the books on 1st July 1986.

f) Rs 684 being the discount allowed by one of the suppliers Mr. Y on 25th June 1987 was omitted to be posted in his account.

Pass rectification entries for the above and draw the "Suspense A/c.

LEC9.Rectify the following errors by way of journal entries and work out their effect on the profit and loss account of the concern:- (49 MINS)

(a) Returns Inwards Book for December was short totaled by Rs.100/-.

(b) Rs.5,810/- being cash paid to HiraChand was debited to Ram Chand as Rs.5,010/-.

(d) A purchase made for Rs.500/- was posted to the purchases account as Rs.50/-Wages paid for erection of machinery amounting to Rs.700/- was debited to wages account.

(f) Goods purchased for proprietor's use Rs.1,000/- was debited to goods account.

(g) A sum of Rs.1,000/- written off machinery has not been posted to depreciation account.

(h) Rs.100/- received from Raghu has been debited to Sunder.

(i) Rs.1,150/- received from Radhey Mohan was debited to his account.

(j) Purchase returns worth Rs.980/- to ShriHariKishan were not recorded in the books. [C.A. Entrance J 85]

LEC10.You are presented with a trial balance showing a difference which has been carried to Suspense Account and the following errors are revealed: (22 MINS)

(a) Rs.1,700/- paid in cash for a Typewriter was charged to Office Expenses Account.

(b) A cash sale of Rs.5,000 to Black, correctly entered in the cash book, was posted to the credit of Black's Account in the Sales Ledger.

(c) Goods amounting to Rs.800/- returned by Blue, were entered in the Sales Book and posted therefrom of the credit of Blue's Account.

(d) Bills Receivable from Brown for Rs.3,000/- posted to the credit of bills payable Account and debited to Brown's Account.

(e) Goods amounting to Rs.10,000/- sold to Red were correctly entered in the Sales Book but posted to Red's Account for Rs.18,000/-.

(f) Sales Returns Book overcast by Rs.100/-.

Journalise the necessary corrections and prepare the Suspense Account.

[DEC-[2] 1987]

LEC11There was difference in the trial balance of shriArihant which was put to newly opened Suspense Account. Subsequently, the following mistakes were discovered. Pass journal entries to rectify them and ascertain the difference in the trial balance :- (44 MINS)

(a) Material costing Rs.700/- in the erection of machinery and the wages paid for it amounting to Rs.400/- were included in the purchases account and the wages account respectively.

(b) Goods sold under credit terms Rs.16,900/- to Mohan were recorded properly in the sales day book but were debited to his account as Rs.19,600/- and carriage outward paid Rs.700/- chargeable from him were posted to sales expenses account.

(c) Sales Returns from yogesh Rs.2,300/- were correctly recorded in the sales returns book from where they were debited to yogesh account by Rs.3,200/-.

(d) Old furniture originally purchased for Rs.1,800/- written down to Rs.1,100 was sold for cash Rs.1,700/- and was credited to Furniture Account.

(e) Machinery purchased on credit Rs.17,000/- was recorded in purchases book and transport charges for the machine Rs.1,200/- were debited to Trade Expenses Account. [C.A. Entrance N 91]

LEC.12Ganesh drew a trial balance of his operations for the year ended 31.03.1992. There was a difference in the trial balance which he closed with a Suspense Account. On a scrutiny by the Auditors, the following errors were found :- (23 MINS)

(i)Purchases day book for the month of April 91 was undercast by Rs.1,000/-.

(ii) Sales day book of October 91 was overcast by Rs.10,000/-.

(iii)A furniture purchased for Rs.8,100/- was entered in the furniture A/c as Rs.810/-

(iv) A bill for Rs.10,000/- drawn by Ganesh was not entered in the bills receivable book.

(v) A machinery purchased for Rs.10,000/- was entered in the purchases day book.

Pass necessary journal entries to rectify the same and ascertain the difference in the trial balance that was shown under the Suspense A/c in respect of the above items. [C.A. Entrance J 93]

LEC 13.M/s Modern Chemicals were unable to agree the Trial Balance on 30th June 1990 and have raised a Suspense A/c for the difference.

Later the following errors were discovered and rectified and the Suspense A/c was balanced. (52 MINS)

a) the addition of the "Sundry Purchases column in the Tabular Purchase Journal was short by Rs 150 and other totals were in order.

b) Bill of Exchange ( received from Gupta) for Rs 2,000 had been returned by the Bank as dishonoured and had been credited to the Bank and debited to Bills Receivable A/c.

c) Goods of the value of Rs 105 returned by the customer. Thomas, had been posted to the debit of Thomas and also, to the Sales Returns.

d) Sundry items of Furniture sold for Rs 3,000 had been entered in the Sales Day Book, the total of which had been posted to Sales A/c

e) An amount of Rs 600 due from Vaz, a customer, had been omitted from the Schedule of Sundry Debtors.

f) Discounts, amounting to Rs 30 allowed to a customer had been duly posted in his account, but not posted to Discount A/c

g) Insurance premium of Rs 450 paid on 30th June, 1988 for the year ended 30th June 1989 had not been brought forward.

i) Pass Journal Entries to rectify the above mistakes.

ii) Draw up the Suspense A/c after rectifying the above mistakes and

iii) Explain how the above errors affect the book profits for the year ended 30th June, 1989.