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CSEET · Fundamentals of Accounting · Accounting Process

The trial balance of Meera Traders did not agree, and the difference of Rs 4,000 was placed on the credit side as a Suspense Account. Later it was found that a sale of goods to Kiran for Rs 4,000 was entered in the Sales Book correctly but was not posted to Kiran's account. What is the rectifying entry?

Debit Kiran's account and credit Suspense Account with Rs 4,000. The omitted debit posting to Kiran caused the credit-side suspense difference, so posting the missing debit to Kiran and closing the suspense balance corrects the books without touching Sales, which was already right.

  1. AKiran A/c Dr 4,000 to Suspense A/c 4,000Correct
  2. BSuspense A/c Dr 4,000 to Kiran A/c 4,000
  3. CKiran A/c Dr 4,000 to Sales A/c 4,000
  4. DSales A/c Dr 4,000 to Suspense A/c 4,000

Explanation

Kiran's debit was missed, so the debit side was short and the trial balance needed a credit suspense balance of Rs 4,000. Posting the missing debit to Kiran and clearing the credit balance of Suspense gives Kiran Dr, Suspense Cr. Crediting Sales again would duplicate the sale, since Sales was already credited correctly.

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