Errors of Principle
(i) Minor Repairs made to the building amounting to Rs.1,850 were debited to the Building Account.
(ii) Furniture purchased for office use amounting to Rs.20,000 has been entered in the purchase day book.
(iii) Rs.1500 paid for wages to workmen for making office furniture had been charged to wages account.
(iv) Salary paid to a clerk Rs.12,000 has been debited to his personal Account.
(v) Wages paid for construction of office building debited to wages account Rs. 20,000.
(vi) An amount of Rs.10,000 withdrawn by the proprietor (Darshan) for his personal use has been debited to Trade Expenses account.
(vii) Legal Expenses Rs. 1,190 paid to Mrs. Neetu was debited to her personal account.
(viii) An amount of Rs. 200 due from Mahesh Chand, which had been written off as a Bad Debt in a previous year, was unexpectedly recovered, and had been posted to the personal account of Mahesh Chand.
(ix) Furniture purchased from Gulab & Bros, Rs.1,000 has been entered in Purchases Day Book.
Errors of Principle – Solutions
(i)
Correct Entry
Repair A/c ——– Dr.
To Cash / Bank / Party
Wrong Entry
Building A/c ——– Dr.
To Cash / Bank / Party
Rectification Entry
Repair A/c ——– Dr.
To Building A/c
(ii)
Correct Entry
Furniture A/c ——– Dr.
To Cash / Bank / Party
Wrong Entry
Purchase A/c ——– Dr.
To Cash / Bank / Party
Rectification Entry
Furniture A/c ——– Dr.
To Purchase A/c
(iii)
Correct Entry
Furniture A/c ——– Dr.
To Cash / Bank / Party
Wrong Entry
Wages A/c ——– Dr.
To Cash / Bank / Party
Rectification Entry
Furniture A/c ——– Dr.
To Wages A/c
(iv)
Correct Entry
Salary A/c ——– Dr.
To Cash / Bank
Wrong Entry
Clerk Personal A/c ——– Dr.
To Cash / Bank
Rectification Entry
Salary A/c ——– Dr.
To Clerk Personal A/c
(v)
Correct Entry
Building A/c ——– Dr.
To Cash / Bank / Party
Wrong Entry
Wages A/c ——– Dr.
To Cash / Bank / Party
Rectification Entry
Building A/c ——– Dr.
To Wages A/c
(vi)
Correct Entry
Drawings A/c ——– Dr.
To Cash / Bank / Party
Wrong Entry
Trade Expenses A/c ——– Dr.
To Cash / Bank / Party
Rectification Entry
Drawings A/c ——– Dr.
To Trade Expenses A/c
(vii)
Correct Entry
Legal Expenses A/c ——– Dr.
To Cash / Bank
Wrong Entry
Mrs. Neetu A/c ——– Dr.
To Cash / Bank
Rectification Entry
Legal Expenses A/c ——– Dr.
To Mrs. Neetu A/c
(viii)
Correct Entry
Bad Debts Recovered A/c ——– Dr.
To Cash / Bank
Wrong Entry
Mahesh ——– Dr.
To Cash / Bank
Rectification Entry
Bad Debts Recovered A/c ——– Dr.
To Mahesh A/c
(ix)
Correct Entry
Furniture A/c ——– Dr.
To Party
Wrong Entry
Purchase A/c ——– Dr.
To Party
Rectification Entry
Furniture A/c ——– Dr.
To Purchase A/c
Clerical Error
Error of Omission
Error of Complete omission
(i) Goods amounting to Rs.6,200 had been returned by a customer and were taken in to inventory, but no entry was made m the books.
(ii) Goods worth Rs. 1,500 returned by Green have not been recorded, anywhere.
(iii) Goods worth Rs.1,400 were dispatched to a customer before the close of the year but no invoice was made out.
(iv) Sale of goods to Mr. R for Rs.3,000 was omitted to be recorded.
(v) Discount received from Black and White Rs. 1,200 has not been entered in the books.
(vi) On 31st December, 2020 goods of the value of ` 300 were returned by Hari Saran and were taken inventory on the same date but no entry was passed in the books.
(vii) Goods worth Rs.150 returned by Green & Co. have not been recorded anywhere.
(viii) Discount received from Red & Black Rs.15 has not been entered in the Discount Column of the Cash Book.
(ix) Discount allowed to G. Mohan & Co. Rs.18 has not been entered in the Discount Column of the Cash Book. The account of G. Mohan & Co. has, however, been correctly posted
Error of Omission – Solutions
Error of Partial omission:
(i) The total of Bills Receivable Book Rs.1,500 left unposted.
(ii) Purchase returns day book had been correctly entered and totalled at Rs. 6,160, but had not been posted to the ledger.
(iii)Bad Debts aggregating `15,000 were written off during the year in the Sales ledger but were not adjusted in the General Ledger; and
(iv)The total of “Discount Allowed” column in the Cash Book for the month of September, 2020 amounting to `12,500 was not posted
Error of Commission
Error of Recording or a transaction is passing through wrong Subsidiary book: –
(i) A purchase of goods from Ram amounting to Rs.150 has been wrongly entered through the Sales Book.
(ii) A Credit sale of goods amounting Rs.120 to Ramesh has been wrongly passed through the Purchase Book.
(iii) Goods of the value of Rs.5,000 returned by Mr. Sharma were entered in the Sales Day Book and posted therefrom to the credit of his account;
Credit sales to Mohan Rs. 10,000 were recorded as Rs. 12,000.
Error of Casting of subsidiary book:
(i) The Sales Book has been totalled Rs.100 short
(ii)Sales return book over cast by Rs. 1,000.
(iii) Purchases book was undercast by Rs. 600
Error of Carrying Forward:
In the sales book total of page no. 4 was carried forward to page 5 as Rs. 1,000 instead of Rs. 1,200 and total of page 8 was carried forward to page 9 as Rs. 5,600 instead of Rs. 5,000
Error of Posting:
(i) A Cheque for Rs. 100 received from Man Mohan was dishonoured and had been posted to the debit of Sales Returns Account.
(ii) Goods purchased Rs.250 have been posted to the debit of the supplier Gupta & Co.
(iii) A return of Rs.120 from Mukesh posted to his debit.
(iv) A payment of Rs.215 to Mohammad Sadiq posted to his credit as Rs.125.
(v) Receipt of cash from Mr. Ashok was posted to the account of Mr. Anubhav Rs.1,200.
(vi) Amount of Rs. 4,167 of sales was wrongly posted as Rs. 4,617.
Error of Wrong Balancing:
Compensating Errors
More Examples for Practice
- The following errors were found in the book of Ram Prasad & Sons. Give the necessary entries to correct them.
(1) Rs.500 paid for furniture purchased has been charged to ordinary Purchases Account.
(2) Repairs made were debited to Building Account for Rs. 50.
(3) An amount of Rs.100 withdrawn by the proprietor for his personal use has been debited to Trade Expenses Account.
(4) Rs.100 paid for rent debited to Landlord’s Account.
(5) Salary Rs. 125 paid to a clerk due to him has been debited to his personal account.
(6) Rs. 100 received from Shah & Co. has been wrongly entered as from Shaw & Co.
(7) Rs. 700 paid in cash for a typewriter was charged to Office Expenses Account