Pass the Journal entries to record/rectify the following transactions in the books of Mr. Saket. Suspense account may be used, if required: (i) Sale…

CA Foundation · Accounting · MTP · September 2026
Pass the Journal entries to record/rectify the following transactions in the books of Mr. Saket. Suspense account may be used, if required: (i) Sale of goods to Somesh at the list price of ₹ 2,00,000/- less 10% trade discount. Out of the amount due 50% is received, out of which two-third is received by cheque and the balance amount is received in cash. CGST and SGST applicable is 6% each. (ii) One of the debtors, Mr. Z has agreed to pay his dues of ₹ 4,500/- to Mr. C who is a creditor of Mr. Saket with the same amount being due to him. (iii) Employees have been given inventory having selling price of ₹ 1,00,000 (Cost price ₹ 75,000) on the eve of Deepawali as a gift. CGST and SGST applicable is 6% each. (iv) A second hand machinery was purchased, and its overhauling charges paid are ₹ 45,000/-. The accountant debited the overhaul charges to Repairs and Maintenance Account. Depreciation on machinery has been charged at 10%. (v) A purchase of ₹ 151 from Mr. Yash was entered in Purchase Day Book as ₹ 15 and posted to Mr. Yash account as ₹ 51. (vi) A cheque of ₹ 14,480 issued to Mr. C. Dass (shown under trade payables) towards his dues has been wrongly debited to the purchases. (vii) R has been issued a credit note allowing rebate of ₹ 6,000/- as goods supplied to him was found defective. CGST and SGST charged @ 6% each. (viii) S was given a credit note of ₹ 2,000/- for making prompt payment for outstanding against goods sold to him. CGST and SGST charged on sale was @ 6%. (ix) An accrual of telephone charges for ₹ 1,410 has been completely omitted. (x) Sale of ₹ 2,500/- made to Mr. Kamal Kumar has been debited to Mrs. Kamla Rani.

Suggested Answer and Working Notes:

Journal Entries in the books of Mr. Saket S No. Particulars Dr. (₹) Cr. (₹) (i) (a) Somesh A/c Dr. 2,01,600 To Sales 1,80,000 To Output CGST 10,800 To Output SGST 10,800 (Being goods sold to Somesh at 10% trade discount, CGST and SGST is applicable at 6% each.) (b) Bank A/c Dr. 67,200 Cash A/c Dr. 33,600 To Somesh 1,00,800 (Being 50% of the amount due is received from Somesh, out of which 2/3rd is received by cheque and 1/3rd in cash) (ii) Mr. C Dr. 4,500 To Mr. Z 4,500 (Being Mr. Z paid his dues to Mr. C) (iii) Misc Expenses A/c /Diwali Gift A/c Dr. 84,000 To Purchases A/c 75,000 To Input CGST 4,500 To Input SGST 4,500 (Being inventory given to employees as Gift and GST input reversed) (iv) Machinery A/c Dr. 40,500 Depreciation A/c Dr. 4,500 To Repairs and Maintenance 45,000 (Being overhauling charges wrongly debited to repairs and maintenance a/c now rectified) (v) Purchase A/c Dr. 136 To Yash 100 To Suspense A/c 36 (Being purchases of ₹ 151 from Yash wrongly posted in purchase book as ₹ 15 and posted to Mr. Yash as ₹ 51 now rectified) (vi) Mr. C. Dass A/c Dr. 14,480 To Purchases A/c 14,480 (Being Cheque issued to Mr. C. Dass wrongly debited to purchases now rectified) (vii) Rebate A/c Dr. 6,000 Output CGST Dr. 360 Output SGST Dr. 360 To R 6,720 (Being rebate allowed to R for the goods supplied was found defective) (viii) Discount allowed A/c Dr. 2,000 To S 2,000 (Being credit given for making prompt payment for outstanding goods sold) (ix) Telephone exp. A/c Dr. 1,410 To Outstanding Expenses A/c 1,410 (Being telephone charges omitted to be recorded now rectified) (x) Kamal Kumar Dr. 2,500 To Kamla Rani 2,500 (Being sale to Mr. Kamal Kumar has been wrongly debited to Mrs. Kamla Rani now rectified)

Topics: Rectification of Errors

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