Question

The following errors are in the books of Mr. Hilal at end March 2017. The error committed is provided. Discuss the following for each of the below errors:

1. The type of error committed; and
2. Rectification Process (in words) and
3. Rectify the error (entry)                                                            

1. Machinery purchased from Mr. Rafiq RO. 8000 was entered into the Purchase book.

Accounts	Dr.	Cr.
Purchases                       Rafiq	8,000	8,000

                    

2. Credit sales to Fatima RO. 10,000 is debited wrongly to the account of Sharifa.

Accounts	Dr.	Cr.
Sharifa                       Sales	10,000	10,000

3. Cash received from customer RO. 4500, entered as RO 4050.

Accounts	Dr.	Cr.
Cash                       A/R	4,050	4,050

4. Goods purchased for Cash RO. 240 posted incorrectly.

Accounts	Dr.	Cr.
Purchases                       Cash	480	480

5. Credit sales to Maryam RO. 12000 is debited wrongly to the account of Mana.

Accounts	Dr.	Cr.
Mana                       Maryam	12,000	12,000

                                                                                                                                                                                                     

Answer 1

i)	Type of error		:	Errors of Principle
	Rectification Process		:	We need to credit Purchase Book and Debit Machinery Account
	Rectification Entry		:
				Particulars			Debit	Credit
				Machinery A/c			$   8,000.00
				To Purchases				$   8,000.00

ii)	Type of error		:	Errors of Commission
	Rectification Process		:	Credit Sharifa and debit Fatima
	Rectification Entry		:
				Particulars			Debit	Credit
				Fatima			$ 10,000.00
				To Sharifa				$ 10,000.00

iii)	Type of error		:	Error of original entry
	Rectification Process		:	Debt Cash and credit A/R by $ 450 ($ 4500 - $ 4050)
	Rectification Entry		:
				Particulars			Debit	Credit
				Cash			$      450.00
				To Accounts Receivable				$      450.00

iv)	Type of error		:	Error of duplication
	Rectification Process		:	Debit Cash and credit Purchase
	Rectification Entry		:
				Particulars			Debit	Credit
				Cash			$      240.00
				To Purchase				$      240.00

v)	Type of error		:	Errors of Commission
	Rectification Process		:	Debit Maryam, credit Mana and Sales
	Rectification Entry		:
				Particulars			Debit	Credit
				Maryam			$ 24,000.00
				To Sales				$ 12,000.00
				To Mana				$ 12,000.00