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Numerical Questions · Q25

Q.Trial balance of John did not agree. He put the difference to suspense account and discovered the following errors :

(a) In the sales book for the month of January total of page 2 was carried forward to page 3 as ₹ 1,000 instead of ₹ 1200 and total of page 6 was carried forward to page 7 as ₹ 5,600 instead of ₹ 5,000.
(b) Wages paid for installation of machinery ₹ 500 was posted to wages account as ₹ 50.
(c) Machinery purchased from R & Co. for ₹ 10,000 on credit was entered in Purchase Book as ₹ 6,000 and posted there from to R & Co. as ₹ 1,000.
(d) Credit sales to Mohan ₹ 5,000 were recorded in Purchases Book.
(e) Goods returned to Ram ₹ 1,000 were recorded in Sales Book.
(f) Credit purchases from S & Co. for ₹ 6,000 were recorded in sales book. However, S & Co. was correctly credited.
(g) Credit purchases from M & Co. ₹ 6,000 were recorded in Sales Book as ₹ 2,000 and posted there from to the credit of M & Co. as ₹ 1,000.
(h) Credit sales to Raman ₹ 4,000 posted to the credit of Raghvan as ₹ 1,000.
(i) Bill receivable for ₹ 1,600 from Noor was dishonoured and posted to debit of Allowances account.
(j) Cash paid to Mani ₹ 5,000 against our acceptance was debited to Manu. (k) Old furniture sold for ₹ 3,000 was posted to Sales account as ₹ 1,000. (l) Depreciation provided on furniture ₹ 800 was not posted. (m) Material ₹ 10,000 and wages ₹ 3,000 were used for construction of building. No adjustment was made in the books. Rectify the errors and prepare suspense to ascertain the difference in trial balance.
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Thirteen errors of every type — carry-forward mistakes, errors of principle, wrong books, wrong personal accounts, and complete omissions. Only the one-sided pieces touch Suspense; netting them shows the trial balance was over on the credit side by ₹13,850.

Treatment. Two-sided errors (d, e, i, j, l, m) are simple transfers and never touch Suspense. Wages/material used on construction (m) and depreciation (l) are complete omissions/adjustments fixed two-sided. The remaining items each leave a single-sided gap routed to Suspense.

Analysis of Suspense-affecting items

RefReasoningSuspense
(a)Sales Book over by 600 (pg 6) less short by 200 (pg 2) = net over 400Cr 400
(b)Machinery 500 − Wages reversed 50Cr 450
(c)Correct Cr (Purchases 6,000 + R & Co. 9,000 =15,000) − Machinery Dr 10,000Dr 5,000
(f)Purchases 6,000 + Sales 6,000 both to be debitedCr 12,000
(g)Correct debits (Purchases 6,000 + Sales 2,000 = 8,000) − M & Co. Cr 5,000Cr 3,000
(h)Raman Dr 4,000 + Raghvan Dr 1,000Cr 5,000
(k)Furniture Cr 3,000 − Sales reversed 1,000Dr 2,000

Rectifying Journal Entries

DateParticularsL.F.Debit (₹)Credit (₹)
(a)Sales A/c ..............................Dr400
  To Suspense A/c400
(Net over-carry of Sales Book: +600 pg 6, −200 pg 2)
(b)Machinery A/c ..............................Dr500
  To Wages A/c50
  To Suspense A/c450
(Wages for installation ₹500 posted to Wages as ₹50)
(c)Machinery A/c ..............................Dr10,000
Suspense A/c ..............................Dr5,000
  To Purchases A/c6,000
  To R & Co. A/c9,000
(Machinery from R & Co. ₹10,000 in Purchases Book as ₹6,000; R & Co. credited ₹1,000)
(d)Mohan A/c ..............................Dr10,000
  To Purchases A/c5,000
  To Sales A/c5,000
(Credit sales to Mohan ₹5,000 recorded in Purchases Book)
(e)Sales A/c ..............................Dr1,000
  To Returns Outward A/c1,000
(Goods returned to Ram ₹1,000 recorded in Sales Book)
(f)Purchases A/c ..............................Dr6,000
Sales A/c ..............................Dr6,000
  To Suspense A/c12,000
(Credit purchases from S & Co. in Sales Book; S & Co. correctly credited)
(g)Purchases A/c ..............................Dr6,000
Sales A/c ..............................Dr2,000
  To M & Co. A/c5,000
  To Suspense A/c3,000
(Credit purchases from M & Co. ₹6,000 in Sales Book as ₹2,000; M & Co. credited ₹1,000)
(h)Raman A/c ..............................Dr4,000
Raghvan A/c ..............................Dr1,000
  To Suspense A/c5,000
(Credit sales to Raman ₹4,000 posted to credit of Raghvan as ₹1,000)
(i)Noor A/c ..............................Dr1,600
  To Allowances A/c1,600
(Dishonoured B/R from Noor debited to Allowances A/c)
(j)Bills Payable A/c ..............................Dr5,000
  To Manu A/c5,000
(Cash paid to Mani against our acceptance debited to Manu)
(k)Sales A/c ..............................Dr1,000
Suspense A/c ..............................Dr2,000
  To Furniture A/c3,000
(Old furniture sold ₹3,000 posted to Sales as ₹1,000)
(l)Depreciation A/c ..............................Dr800
  To Furniture A/c800

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