Journal corrections

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT student discussion
Hi everyone,

I thought I was doing quite well at college doing my foundation course until Tuesday night when we started to do journal corrections with questions like:

Returns inwards £833 have entered on the debit side of the return outwards account.

To me this only seems like half a question, I just sat there and felt totally thick. Is there a way that will help me as at the moment I feel totally stressed.

Hayley


Comments

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Journal corrections

    This type of question is common. When i sat foundation, i would tackle this question by looking at the origianl transaction 'Returns inwards £833' Then you need to write down, how you would enter this onto the account. Once you are happy with how you would post it, go on to look at how it has been posted (incorrectly) Then make the double entry to clear the incorrect transaction, and then post the transaction, the way you have decided it should be. Practice is important with journals, in learning the double entry system. Keep trying!
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Journal corrections

    ok first of all im guessing you are asking what the solution is and how to tackle it.

    From the top:

    A sale is assuming no VAT:

    Dr. Debtors
    Cr. Sales

    A return is thus:

    Dr. Returns Inwards (In practice most people would debit sales, and not bother with a returns account)
    Cr. Debtors

    If it has accidentally been debited to returns outwards simply:

    Cr. Returns Outwards
    Dr. Returns Inwards.

    In answer to your question, im afraid my only advice is to follow logically and consider what should of happened, contrast it with what has happened, and then correct.

    After years of doing double entry I still often have to sit and mentally work it through for a few moments (I had to think for a moment on this question to)Hope this is of a little help.

    Adrian
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Journal corrections

    I found the best way to do this when starting out was to draw up quick 'dummy' T-accounts that just have the erroneous entry and what the correct entry sould be and use that to figure out what needs to be done. I still do this if I'm not sure how to do a journal.

    So, if you've got a returns inwards entered on the debit side of returns outward, then the erroneous Returns Out account will be

    Returns Out
    Debit 833
    Credit 0

    and you need to end up with the correct Returns In a/c

    Returns In
    Debit 833
    Credit 0

    Now first you need to get the 833 out of the Returns Out a/c so you need to credit that account with 833. Completing the double entry you debit the Returns In a/c and voila, you have your correct entries.

    So your journal will be

    Returns Out 833 Cr
    Returns In 833 Dr

    As Paul said, all you can really do is keep practicing . I think most people find journals tricky at first but keep going and you will get the hang of them.

    Hope I haven't confused matters

    Chris
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Journal corrections

    Hi,

    I just wanted to thank you for your replies, I am going to practise this weekend and hopefully it will sink in.

    I just panicked at college and thought I may as well just stop going as it would get harder and I wouldn't pass the exam.

    Hayley
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Journal corrections

    In all seriousness, when I started AAT Ihad no accounts experience, and I went through those thoughts to! I honestly didnt grasp double entry until a month before the central assessment, when a lady who was experienced in accounts environment, explained it better to me than the teacher did!
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Journal corrections

    How did she explain it to you Paul?

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