1. Sundry Debtors A/c Dr. 500
To Bad Debts Recovered A/c 500
2. Bank A/c Dr. 25
To Bank Charges A/c 25
3. Sundry Creditors A/c Dr. 100
To Purchase Returns A/c 100
Any Change in Sundry Debtors A/c, Bank or Sundry Creditors A/c does not make any impact on the profit/loss of the firm.
Any changes which occur in income or expenses account, do impact the profit/loss of the firm. For example debts recovered is an income so will increase profits by $500. Similarly decrease in bank charges will increase income by $25 and increase in Purchase Returns by $100 will increase the profits. So net increase in profit will be $625 ($500+$125+$100).
Only method to know profit or loss on account of rectification of errors is to post all the income and expense account to the P & L A/c and find out the net result.