O-LevelAccountingVerification of accounting records7707/13 · Oct/Nov 2023 · Q141 Mark
Jane wished to make a contra entry between a sales ledger account and a purchases ledger account. The credit entry was made correctly but the debit entry was entered in the sales returns account in error. What was the effect of this error?
ATotal purchases ledger balances were overstated.
BTotal purchases ledger balances were understated.
CTotal sales ledger balances were overstated.
DTotal sales ledger balances were understated.
✓ Correct answer
A: Total purchases ledger balances were overstated.
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