PRC-1 · Chapter 8 · Question 7 of 100
A sale of Rs. 200 recorded in sales day book to BTS & Co was credited to their account. What journal entry must be recorded to correct this error?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: A) DEBIT: BTS & Co Rs. 400 and CREDIT: Suspense Rs. 400
Explanation
A sale to a customer should be debited to their account. By mistakenly crediting them with Rs. 200, the account is off by Rs. 400. To correct this, the customer's account is debited by Rs. 400 and suspense is credited.
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