Question

Goods purchased from A for ₹10,000 passed through the

Q: Answer-Goods purchased from A for ₹10,000 passed through the sales book. The error will result in:

Purchases should be debited, but if wrongly recorded in the sales book, it results in an increase in both sales and gross profit. Since actual purchases are understated and sales are overstated, gross profit will be overstated, causing a fictitious increase in gross profit.

sales book. The error will result in:

A Increase in gross profit

B Decrease in gross profit

C No effect on gross profit

D Increase in liabilities

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Goods purchased from A for ₹10,000 passed through the

Solution