WELCOME TO THE WORLD OF ACCOUNTING

BY

SUBBU PULLELA

JOURNAL

As I said in this post I’m going to show youthe following… Transactions related to Income and

Expenses. Transactions related to Receipts and

Payments. Transactions related to Proprietor. Transactions related to Discount. Transactions related to Bad Debts.

1st April, Paid salaries of 25,000₹

Transactions relating to Income and Expenses:

Salaried A/c..............Dr 25,000 To Cash A/c 25,000(Being the salaries paid to Employees.)

2nd April, Paid rent to Land lord of 2,000₹Rent A/c.....................Dr 2,000 To Cash A/c 2,000(Being the Rent paid to Land lord)

3rd April, Received dividend on shares of 5,000₹

Cash A/c………….........Dr 5,000 To Dividend A/c 5,000(Being the Dividend receivedOn shares)

4th April, Received commission from suresh of 4,000₹Cash A/c.....................Dr 4,000 To Commission A/c 4,000(Being the Commission Received from suresh)

1st April, Received cash from phani on account 5,000₹

Transactions relating to Receipts and Payments:

Cash A/c…...............Dr 5,000 To Phani A/c 5,000(Being the cash receivedOn account.)

2nd April, Paid Ramya on account 15,000₹

Ramya A/c................Dr 15,000 To Cash A/c 15,000(Being the cash paid onaccount.)

3rd April, Took loan from hareesh 25,000₹

Cash A/c………..........Dr 25,000 To Loan from Hareesh A/c 25,000(Being the loan taken)

4th April, Given loan to Rajesh 10,000₹

Loan to Rajesh A/c…..Dr 10,000 To Cash A/c 10,000(Being the loan given)

10th April, Bhaskar commenced with a capital of 2,00,000₹

Transactions relating to Proprietor:

Cash A/c.....Dr 2,00,000 To Capital A/c 2,00,000(Being the capital broughtin by Bhaskar)

11th April, He withdraws cash for personal use ₹10,000Drawings A/c....................Dr 10,000 To Cash A/c 10,000(Being the cash withdrawnFor personal use.)

12th April, He took goods for domestic use of 5,000₹Drawings A/c....................Dr 5,000 To CPurchases A/c 5,000(Being the took goodsFor personal use.)

13th April, He withdrawn cash from bank for personal use 6,000.₹Drawings A/c....................Dr 6,000 To Bankj A/c 6,000(Being the cash withdrawnFrom bank for personal use.)

1st April, Purchased goods from pavan @ 20% trade discount, list price of the goods is 8,000₹

Transactions relating to Discount:

Purchases A/c……….....Dr 6,400 To Pavan A/c 6,400(Being the goods purchased ata trade discount from list priceof 8,000)₹2nd April, Returned goods to pavan as these were defective, the list price of these goods is 600₹

Pavan A/c…………Dr 480 To Purchases A/c 480(Being the goods returned topavan after deducting trade discount from list price of 600)₹3rd April, Sold the goods to ramesh for cash, the list price of these goods is 2,000. Trade discount @5% ₹and cash discount @1% are allowed to him.

Cash A/c………...............Dr 1,881Discount A/c………......Dr 19 To Sales A/c 1,900(Being the goods sold for a trade discount of @5% and a cash discount of 1% on list price₹2,000 )

4th April, Received 9,850 from krishna after allowing ₹him a discount of 150. ₹Cash A/c………...............Dr 9,850Discount A/c………......Dr 150 To Krishna A/c 10,000(Being the cash received fromKrishna after allowing a discountof 150)₹

5th April, Paid to kalpana 3,000 and she allowed as a ₹discount of 150. ₹

Kalpana A/c.....................Dr 3,000 To Cash A/c 2,950 To Discount A/c 50(Being the cash paid and received discount.)

1st April, Ravi a debtor become insolvent. He owed 5,000, a final dividend of 0.50 in rupee was ₹ ₹

received.

Transactions relating to Bad debts:

Cash A/c………...............Dr 2,500Bad debt A/c………......Dr 2,500 To Ravi A/c 5,000(Being the cash received fromRavi in full and as final settlement)

2nd April, Returned goods to pavan as these were defective, the list price of these goods is 600₹

Cash A/c………….……Dr 1,000 To Bad debt A/c 1,000(Being the bad debt received from Ravi.)

Mr. Ram Kumar position as on 1st April, 2016 is as follows:

Transactions relating to Opening Entries:

Building A/c……............Dr 30,000Furniture A/c………......Dr 3,000Stock A/c………..............Dr 40,000Cash A/c…...…………......Dr 2,000Bank A/c………...............Dr 10,000Debtors A/c…………......Dr 30,000 To Loan A/c 60,000 To Creditors A/c 75,000 To Capital A/c* 20,000(Being the opening entry passedand the difference between Dr. andCr. Entries is Capital *)

Property and Assets:Buildings 30,000₹ Furniture

3,000₹Stock 40,000₹ Cash in Hand

2,000₹Customers A/c 30,000₹ Cash at Bank

10,000₹

Liabilities:Loan 60,000 Suppliers A/c ₹

75,000₹

Pass opening entry in the books of Ram Kumar.