438-Assignment 2 Solution 2022-Autuman 2022-Q No 5-AIOU

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438 Assignment 2 Solution 2022-Autuman 2022-Q No 5-AIOU  Questions Rectify the following errors by passing the necessary journal entries.  a. The sales book has been under-cast by Rs. 8,000.  b. A cheque drawn for wages for Rs. 1, 500 was wrongly posted to wages A/c as Rs. 1, 400.  c. Furniture purchased for Rs. 1,040 has been debited to purchase A/c as Rs. 1,640.  d. Rs. 550 received from Rahim debited to his account.  e. Discount received Rs. 200 was posted to the wrong side of Discount A/C  f. Rs. 7,000 paid in cash for a typewriter was charged to office expenses account  g. Stationary purchased for Rs. 890 but debited to stationary A/c as Rs. 980.

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00:00bismillahirrahmanirrahim assalamu alaikum dear students and viewers welcome to my youtube channel

00:05in today's video we are going to solve the question number five of assignment number

00:10two of subject 438 which is labeled as principle of appointing and related to

00:16b.a.b.com of a.i.o.u it is also related to the semester autumn 2022 so let's start reading the

00:25questions and their related tasks and then we will going to solve the every task associated

00:30with the question number five so rectify the following errors by passing the necessary

00:36general entries so uh they are one two three four five six seven seven transactions which

00:45have some errors regarding single side or single account or double side or double account or two

00:52accounts so you have to identify that one and then pass the correct one entry to rectify the

01:00account status so let's start reading the first transaction the sales book has been under cost

01:06by rupees eight eight thousand as it is clear that only the sales book is under cost under cost

01:14is below below from the actual value and the actual value let's suppose the actual value is

01:22ten thousand but it has been and the sales book has been reported under cost by means less eight

01:30thousand so it means in the sales book we have two thousand rupees but we have to increase the

01:37share size by rupees eight thousand to to equate with the actual amount of rupees eight thousand

01:43i hope you understand the word under cost the second transaction is a check drawn for wages

01:49for rupees one thousand five hundred was wrongly posted to wages account as rupees one thousand

01:56four hundred again this is transaction is related to or this error is related to one-sided one

02:02account error because only one account is involved here which is account and actual

02:09the one thousand five hundred which has been paid and to the workers but the account is

02:15debited by the less amount which is one thousand four hundred and the last amount is equal to

02:23hundred rupees so you need to increase the expenses by the rupees 100 by debiting the

02:30wages account with the mod amount of rupees 100 so furniture purchase for rupees 1040 has been

02:36debited to purchase account as rupees one thousand six hundred four one thousand six hundred forty

02:43so look at this transaction let's make analysis of this one there are three accounts involve this

02:50transaction so two accounts are directly involved and which has been which has been introduced in

02:57the solution first account is furniture which is totally absent from the from the book of records

03:04because its amount is wrongly debited to the purchase account so in first step we are going

03:11to eliminate this account this wrong debited value from the purchase account and transfer it to the

03:18right account furniture purchase account and the second issue is that the

03:23excess amount has been debited to the account so what is the issue is here first we have to

03:31uh carried the purchase account with the same amount but debited the furniture account with

03:37this amount which is less than one thousand six hundred forty so what about the difference

03:42between these two amount six hundred it will be handed through the suspense account we don't know

03:49the other sides of the error of error or other side of the account of the other transactions

03:58the rupees 550 from rahim debited his account it means uh him is our account receivable account we

04:08have sell something to him on credit basis and later it will give us money in form of cash i

04:15check so we need to carry this account but unfortunately or by mistake we have debited

04:21this account it means we have increased this liability by rather reducing its liability by

04:28rupees 550 so again this is a single account side error discount received rupees 200 was posted to

04:38the wrong side of the discount account so wrong side let's first understand what is this account

04:45if we give discount it is expense and it will be occupied the debit side of the account if we

04:51receive discount it will be income and it will be occupied the credit side of the account but here

04:58we receive discount of rupees 200 it means it is income of the business so it should be posted or

05:05placed on the credit side but wrong side means if we have placed on the debit side of the discount

05:10account so again only one single account or error is involved in this transaction and we need to

05:17correct this one um by first and we correct the entry by 200 bond then we will pass the

05:26increase the our credit side by this 200 amount so let's move to the

05:32next transaction rupees 7000 is paid in cash for a typewriter was charged to office expense account

05:46the business has purchased the typewriter which is an asset of rupees 7000 but by mistake it has

05:52been posted to the office expense account which is an expense account in nature so two accounts

05:59are involved here so we simply uh credit this account and debit typewriter account

06:05stationary purchase for rupees 890 but debited to stationary account as rupees 980 so uh account

06:13is debited correctly but uh with our cost amount because our uh stationary account has been

06:21increased by the amount of rupees 90 so we have to be credited this or reduce this account so

06:28again in this transaction single account is involved or type of a single account error is

06:35available there let's move to the solution of this account so uh this is about and the

06:42sales book has been under cost by rupees 8000 so this single side or one side and wage account

06:48sorry sale account by mistake i have written the sales account sales account so we increase

06:57the sales account but we don't know the other side of the transaction only one single account

07:03is involved so we have to be introduced expense account to rectify all this kind of error which

07:09have involved only single account so we need to increase the credit side of sales account

07:16by the rupees 8000 so the expense account is debited and sales account is credited by 8000

07:24as a result our account sales account will be increased by the 8000 and the issue of under

07:30cost will be solved second transaction a check drawn for wages for rupees

07:351500 was wrongly posted to the wages account as it is 1400 so we need to increase the wages count by

07:44100 again single account is involved we introduce a suspense account but look at this

07:50here's a special called the debit and here's a special kind of credit so

07:55the special can't move as per the nature of the transaction sometimes it is debited sometimes it

08:01is credited so at the end it will be automatically be balanced if there's some difference we'll keep

08:07it as it is and we will again go to the records and get the details inside to trace out this

08:15fault or this error so we we need to increase the wages expense account and double side with 100 so

08:24we make this debit by 100 and suspense about 100 now the transaction number c or third furniture

08:33purchase at rupees 1040 has been debited to purchase account as rupees 1640 look at this

08:41it is clear from the statement that there are two account directly involved which is furniture

08:47account and and the other is purchases account but we have to correct the purchasing account

08:55and post the correct amount to the furniture account but there's a difference of 600 degrees

09:00how do we rectify a settle this amount by using the suspense account we are going to

09:06handle this 600 code now we look at the entry a general entry of the this transactions

09:14furniture account 1040 the correct amount the special account which is contained the difference

09:21of the two amount 600 and we are going to here is the debit it so which is the point is always

09:27debited but we need to reduce it so we are going to credit this account by the 1640 i hope you

09:35will understand this here now the transaction number d rupees 550 is free from him debited to

09:42his account so suspense account again second account is involved to rahim account by 1100

09:48why i am going to be double this amount the question is here that because 5 first 550 is

09:55balanced with this amount it means first 550 is cancel the effect of this 550 and the second 550

10:02will reduce the liability of the rahim account uh i will make a little bit mistake of spelling

10:11here so please correct it look at this i am going to make a uh him account here as part of this

10:17transactions debit inside and credit side look at on 10th january we have passed this entry on

10:25debit side which is wrong because we have received cash from the rahim so it should be placed on the

10:31credit side but we wrongly posted on in and upper side it means it will increase the liability of

10:37the rahim actually we have to reduce the liability of the rahim by the 550 so first 1150 if you

10:45subtract 500 550 550 from 1100 you will get 550 on the credit side it means now the him account

10:57is correct and its liability has been reduced by 550 now discount received rupees 200 was posted

11:04to the wrong side of the discount account discount account is that one which has two kind of

11:10transaction discount received and discount allowed if you are discount allowed it will be occupied

11:17the debit side if you receive discount is there it will be go to the credit side of the discount

11:22discount received is always income of the business and discount allowed is always the expense of the

11:28business so here is this income so but it is posted under the heading of debit side so we

11:36have to correct this one again single side discount received is single side error for

11:42only discount account is involved we need to correct the debit side by posting it into the

11:50credit side the expense account again we are going to make it double first entry is going to be

11:56correct correct 200 and the rest 200 is going to be correct the other side of the transaction so

12:03discount account so first 200 is cancelled by the 200 and the second 200 is increase our discount

12:12income transaction f rupees 7000 paid in cash for typewriter was charged to office expense

12:20account again and two account directly involved here so we need to correct office expense account

12:27by editing it and introduce the typewriter account which is going to make it correct typewriter

12:33account 7000 to office expense i just written here expense you can add it office but here

12:40to make it correct account so with 7000 last one stationary purchase for rupees 890 but

12:47debited to stationary account uh rupees 980 now the issue is that here uh posting of transaction

12:54is correct but uh but the correction uh but the incorrectness in this transaction is that it has

13:02been overstated by the rupees 90 so we need to correct it how here we credited this account by

13:10nature it is a debit account but we have increased this stationary account by with the amount of

13:15rupees 90 so we we want to reduce this so in correct transactions we are going to make expense

13:22upon debit and to stationary account rupees 90 as a result our stationary account becomes correct

13:28i hope you understand this solution if you have any query or if you found any mistake please

13:35mention in comment section if you want to share your opinion with me regarding any transaction

13:41of this question we are here to discuss only to make it uh improved solution thanks for watching

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