PRC-1 · Chapter 8 · Question 27 of 100
A business paid Rs. 5,000 to a supplier, Ahmed. It was correctly credited to the cash book but debited to the account of another supplier, Ali. What is the correcting journal entry?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) Debit Ahmed Rs. 5,000, Credit Ali Rs. 5,000
Explanation
To correct this error of commission, the falsely debited account (Ali) must be credited to reverse it, and the intended account (Ahmed) must be debited.
More Correction of Errors MCQs
- Q29A credit sale of Rs. 4,800 to Zaid was recorded in the sales day book as Rs. 8,400 and posted to the ledger accordingly. What is the…
- Q30The sales return day book was overcast by Rs. 1,200. What is the correcting journal entry?
- Q31Discount received of Rs. 600 was omitted from the Discount Received account in the general ledger, although it was correctly entered in…
- Q32Bank charges of Rs. 300 were completely omitted from the books. How does this affect the financial statements before correction?
- Q33Cash sales of Rs. 2,000 were posted to the credit of the Sales account but mistakenly debited to Trade Receivables instead of Cash. What…