In the sectional balancing system, normal rectification entries are made with a slight deviation because of this method. only two memorandum accounts (total debtors account and total debtors account) are opened in the general ledger which is not a part of the double-entry system.
Rectification of Errors Under Sectional Balancing System
David’s maintenance control account in the General ledger. the net total of the balances extracted from the sales ledger as of 30th June 2010 amounted to $6,438 which did not agree with the balance of the sales ledger control account.
On checking, the following errors were discovered After the Adjustment of which the books balanced and the correct net total of the sales ledger balances agreed with the Amended balances of the control account:
- Sales return book had been overcast by $100.
- A balance Owing to M off 239 has been written off as bad on 30 June 2010 and debt to bad debts account but no entry was made in control account.
- A Debit balance of $735 and credit balance amounting to $23 has been omitted from the list of balances.
- No entries had been made in control account in respect of a transfer of $80 standing to the credit of A’s account in purchase ledger to his account in the sales ledger.
- A check of $127 received from C had been dishonored but the entry to record this fact in the cash book has not been posted to C’s account although dealt within control account.
- A discount of $15 allowed to us has been correctly recorded and posted this was subsequently disallowed and the corresponding amount was entered in the discount received column in cash book and posted to S’s account in purchase ledger and included in the total of discount received.
Related:
- Sectional Balancing System: Explanation with Examples (Updated)
- Self Balancing Ledger System: Definition, Examples, Diagram
Give journal entries without narration and if No general entry is required, state how these Errors will be corrected also set of the total debtors account showing the balance before and after the Correction/Rectification of errors under sectional balancing system.
Journal
Total Debtors Account
Reconciliation Statement
Thus, now you know the how Rectification of errors under sectional balancing system.
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