how to correct errors in subsidiary ledger

System
System Posts: 100,534 🤖 Admin 🤖
edited 10:29AM in AAT student discussion
When doing reconciliation between the SLCA and the subsidiary ledgers, some difference we found, then I found it was in subsidiary ledger, for example, debtor A has been posted £70 less from SDB. what should we do to correct it , should we use journal entry.

Comments

  • System
    System Posts: 100,534 🤖 Admin 🤖
    how to correct errors in subsidiary ledger

    All I could think is :<BR><BR>Journal entry:<BR>Debtor A account Dr £70<BR><BR>But there is only one entry, it seems wrong. anyone know these?<BR><BR>Thank you!
  • System
    System Posts: 100,534 🤖 Admin 🤖
    how to correct errors in subsidiary ledger

    The subsidiary ledger for Debtors is really just an itemised list of names and sales values. Once posted to the SLCA it becomes a total made up of those values.<BR><BR>It sounds like an "error of original entry", where the wrong figure has been entered on both the debit and credit sides of the ledger (ie) underposted. If so, the correcting entry would be Dr SLCA/Cr Sales.<BR><BR>Hope this helps,<BR><BR>David
  • System
    System Posts: 100,534 🤖 Admin 🤖
    how to correct errors in subsidiary ledger

    I agree<BR><BR>All that is needed is the the control account and the subsiduary ledger need to be adjusted<BR><BR>Depending upon when the error is found, a journal entry may be required.
  • System
    System Posts: 100,534 🤖 Admin 🤖
    how to correct errors in subsidiary ledger

    The error is only in the subsidiary ledger, so do you think there is no need to use journal entry to correct it?<BR><BR>Because I was asked how to correct it, if need journal, use journal entry form provided, so I used journal entry, but can only think of one entry as I mention above.
  • System
    System Posts: 100,534 🤖 Admin 🤖
    how to correct errors in subsidiary ledger

    Like Michelle suggested previously, a journal would be required depending on what's gone before.<BR><BR>I'm going to assume that you have posted your Debtors subsidiary ledger to your SLCA. The entry should have involved debiting SLCA and crediting Sales (also assuming that vat is not involved). If you then find that the subsidiary ledger was underposted, you'll need to do a journal to correct the difference, ie, Dr SLCA/Cr Sales.<BR><BR>Regards,<BR><BR>David<BR><BR>
  • System
    System Posts: 100,534 🤖 Admin 🤖
    how to correct errors in subsidiary ledger

    Thank you very much for your reply.But I think I didn't make the question clear.<BR><BR>When the figures were posted from Sales day book, the total was posted to SLCA, the net to sales, the VAT to VAT, that's correct, then the individual invoice was posted to subsidiary debtors, then error was made. So, actually, the double entry system is all right, only the mamorandum account was wrong. So, when I was doing reconciliation between the SLCA and the total balance of the subsidiary account, I found the difference.<BR><BR>But now I think acutally I shouldn't use journal entry at all. What do you think?
  • System
    System Posts: 100,534 🤖 Admin 🤖
    how to correct errors in subsidiary ledger

    The subsidiary accounts do not form part of the double entry book keeping system, so you would not need to journal the adjustment. <BR><BR>Hope that helps...!

Categories

Privacy Policy