Question 7 of 52intermediate🔧 ApplyNumerical3 marks

Sales returns from Megha ₹ 1,600 were posted to her account as ₹ 1,000. This is an error of ... The wrong effect has been: The correct effect should have been: The rectification entry will be:

Correct Answer

(correct_effect) The correct effect should have been: Megha’s A/c should have been credited with ₹ 1,600.

(error_type) This is an error of commission.

(rectification_entry) The rectification entry will be: Suspense A/c Dr. ₹ 600; To Megha’s A/c ₹ 600.

(wrong_effect) The wrong effect has been: Megha’s A/c has been credited with ₹ 1,000 instead of ₹ 1,600, resulting in a short credit of ₹ 600.

Exercise: Test Your Understanding - III | Q: 3 | (Page 25)
For More Understanding

Explanation

This question is analogous to example (b) in the provided context, where Credit sales to Mohan (a debtor) were posted to his account for a lower amount. Here, Sales returns from Megha (a debtor) were posted to her account for a lower amount. Since the Sales Returns book was likely totalled correctly (assuming this as per standard pattern for 'posted to his/her account' errors), the Sales Returns Account is correct, but Megha's Account has a short credit. The difference is debited to Suspense Account to balance the entry.

Solution Steps

  1. Step 1: Identify the type of error. As per the context, recording or posting an amount incorrectly (but on the correct side) is an error of commission.

  2. Step 2: Determine the wrong effect. Megha’s account was credited with ₹ 1,000 instead of ₹ 1,600. This means her account has a short credit of ₹ 600 (₹ 1,600 - ₹ 1,000).

  3. Step 3: Determine the correct effect. Megha’s account should have been credited with the full amount of ₹ 1,600.

  4. Step 4: Pass the rectification entry. To correct the short credit, Megha’s account must be credited with the difference (₹ 600). The corresponding debit goes to the Suspense Account.