Accounting – 3.2 Correction of errors | e-Consult
3.2 Correction of errors (1 questions)
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Journal Entry 1: Correcting the incorrect debit to Sales Revenue
| Date: 1st January 2023 | Account Debited: Sales Revenue | Amount: £500 |
| Account Credited: Purchases | Amount: £500 |
Journal Entry 2: Correcting the incorrect credit to Purchase Returns
| Date: 15th January 2023 | Account Debited: Purchase Returns | Amount: £200 |
| Account Credited: Purchases | Amount: £200 |
Explanation: The first journal entry corrects the overstatement of Sales Revenue by debiting it and crediting the Purchases account. The second journal entry corrects the understatement of Purchases by debiting Purchase Returns and crediting the Purchases account.