Maharashtra Board Class 11 Commerce BK Chapter 4 Ledger Solutions

Class 11 Commerce BK Chapter 4 Exercise Solutions

1. Answer in One Sentence Only.

Question 1. What is Ledger?
Answer: Ledger is an important book of account in which individual records business transactions with respect to persons, properties, expenses, or losses are maintained.
In simple words: A ledger is a central accounting book that keeps a summary of all financial transactions, categorized into separate accounts for easy reference and balancing.

🎯 Exam Tip: Understanding the definition of a ledger is fundamental to bookkeeping, as it clarifies where aggregated financial data is stored after initial journal entries.

 

Question 2. What is ledger posting?
Answer: Transferring the entry passed in the journal to the ledger for the individual record is called ledger posting.
In simple words: Ledger posting is the process of moving financial information from the journal (where transactions are first recorded) to the specific accounts in the ledger.

🎯 Exam Tip: Accurately explaining ledger posting demonstrates a grasp of the accounting cycle's procedural steps.

 

Question 3. When does an account show a nil balance?
Answer: When the total credit side of an account equals the total of the debit side, such an account shows a nil balance.
In simple words: An account shows a nil balance when the total of all money received (credit side) perfectly matches the total of all money paid out (debit side).

🎯 Exam Tip: This concept highlights the balancing nature of double-entry accounting and is crucial for preparing financial statements.

 

Question 4. What is Folio?
Answer: Page number of the account opened in the ledger is called Ledger folio.
In simple words: A ledger folio is essentially the page number in the ledger where a specific account's details can be found, linking it back to the journal entry.

🎯 Exam Tip: Knowing the term 'Ledger Folio' is important for understanding cross-referencing in accounting records.

 

Question 5. Where is the statement form of ledger A/c is used in actual practice?
Answer: The statement form of ledger A/c is used in the banks and financial institutions to prepare the client's account showing balances of accounts after each transaction is complete.
In simple words: The statement form of a ledger account is commonly used by banks and financial institutions to provide customers with a clear, updated balance of their account after every single transaction.

🎯 Exam Tip: This question tests practical application knowledge of ledger formats, particularly in real-world financial contexts.

 

Question 6. Why Proprietor's Capital account is a liability for the business?
Answer: Capital invested in the business by the proprietor is an asset for the proprietor and liability for the business.
In simple words: From the business's perspective, the capital provided by the owner is a liability because the business owes that money back to the owner.

🎯 Exam Tip: This question assesses understanding of the separate entity concept in accounting, a core principle for classifying accounts.

 

Question 7. Why does a cash account never shows a credit balance?
Answer: Available cash with the business is an asset of the business and the account of every asset shows debit, cash account always shows debit balance.
In simple words: A cash account always has a debit balance because you cannot spend more cash than you physically possess; cash is an asset, and assets typically have debit balances.

🎯 Exam Tip: This question checks the fundamental rule of debit and credit for asset accounts and the practical limit of cash outflow.

 

Question 8. What is 'Trial Balance'?
Answer: Trial Balance is an abstract or list of all the ledger accounts as on a specified date showing debit total and the credit total of all the accounts or their net balance.
In simple words: A Trial Balance is a summary list of all ledger account balances on a specific date, used to check if total debits equal total credits, ensuring arithmetical accuracy.

🎯 Exam Tip: Defining a Trial Balance correctly is vital for understanding its role as an interim step before preparing final accounts.

2. Write The Word, Term, Phrase, Which Can Substitute Each Of The Statements.

Question 1. Principal Book of accounts.
Answer: Ledger
In simple words: The ledger is considered the principal book because it systematically organizes all financial data into accounts, providing a comprehensive overview.

🎯 Exam Tip: Identifying the ledger as the principal book is a key definitional point in basic accounting principles.

 

Question 2. Transferring a journal entry to the appropriate accounts in the Ledger.
Answer: Posting
In simple words: 'Posting' is the specific term for the action of moving recorded transactions from the journal to their respective ledger accounts.

🎯 Exam Tip: The term 'posting' is fundamental to describing the process of updating ledger accounts from journal entries.

 

Question 3. Page number of Ledger to which an entry is posted.
Answer: Ledger folio
In simple words: The 'ledger folio' is the reference number that helps locate the exact page in the ledger where a journal entry has been posted.

🎯 Exam Tip: This term reinforces the importance of cross-referencing for audit trails and efficient record-keeping.

 

Question 4. The process of extracting the balance and inserting it on the lesser side of an account.
Answer: Balancing
In simple words: 'Balancing' an account involves calculating the difference between its total debits and credits and placing that difference on the side with the smaller total to make both sides equal.

🎯 Exam Tip: Understanding 'balancing' is critical for preparing a trial balance and subsequent financial statements.

 

Question 5. A debit balance to Personal Accounts.
Answer: Debtor
In simple words: A debit balance in a personal account signifies that a person or entity owes money to the business, making them a debtor.

🎯 Exam Tip: Correctly identifying a debit balance in personal accounts as a 'debtor' is essential for understanding accounts receivable.

 

Question 6. A credit balance to Bank Account.
Answer: Bank overdraft
In simple words: A credit balance in a bank account means the business has overdrawn its account, owing money to the bank, which is a bank overdraft.

🎯 Exam Tip: This answer requires knowledge of how bank balances are represented and common banking terms like overdrafts.

 

Question 7. An account to be debited for goods damaged by fire.
Answer: Loss by fire
In simple words: When goods are damaged by fire, the 'Loss by Fire' account is debited because it represents an expense or loss incurred by the business.

🎯 Exam Tip: This question tests the application of nominal account rules for recording unusual losses.

 

Question 8. A Trial Balance in which only net balances of all ledger accounts are transferred.
Answer: Net Trial Balance
In simple words: A Net Trial Balance lists only the final, single debit or credit balance for each ledger account, rather than the total debits and credits.

🎯 Exam Tip: Differentiating between a gross and net trial balance showcases a deeper understanding of trial balance preparation methods.

3. Select Appropriate Alternatives From Those Given Below And Rewrite The Sentences.

Question 1. In case of a credit transaction one of the account must be a ____________ account.
(a) Cash
(b) Credit
(c) Personal
(d) Debit
Answer: (c) Personal
In simple words: For any credit transaction, at least one of the accounts involved must be a personal account, which represents an individual or entity.

🎯 Exam Tip: This MCQ assesses knowledge of the fundamental categories of accounts (Personal, Real, Nominal) and their relevance to credit transactions.

 

Question 2. 'c/d' indicates ____________ balance.
(a) Opening
(b) Closing
(c) Positive
(d) Negative
Answer: (b) Closing
In simple words: In accounting, 'c/d' stands for 'carried down' and refers to the closing balance of an account at the end of an accounting period.

🎯 Exam Tip: Understanding common accounting abbreviations like 'c/d' and 'b/d' is crucial for interpreting ledger accounts.

 

Question 3. ____________ Column of ledger is used for writing page number of Journal.
(a) J.F.
(b) L.F.
(c) Date
(d) Particulars
Answer: (a) J.F.
In simple words: The J.F. (Journal Folio) column in the ledger is used to record the page number from the journal where the original entry for a transaction can be found.

🎯 Exam Tip: Correctly identifying the 'J.F.' column highlights an understanding of the cross-referencing system between the journal and ledger.

 

Question 4. Debtors Account shows ____________ balance.
(a) Real
(b) Negative
(c) Credit
(d) Debit
Answer: (d) Debit
In simple words: A Debtors Account always shows a debit balance because debtors owe money to the business, representing an asset.

🎯 Exam Tip: This question tests a fundamental rule: assets (like amounts owed by debtors) typically have debit balances.

 

Question 5. ____________ is the process of deriving the difference between totals of the debit and credit side of each ledger a/c.
(a) Totalling
(b) Journalizing
(c) Balancing
(d) Posting
Answer: (c) Balancing
In simple words: Balancing an account is the act of finding the net difference between all debit and credit entries to determine the account's final balance.

🎯 Exam Tip: Clearly defining 'balancing' is important for demonstrating knowledge of ledger reconciliation.

 

Question 6. Total of Purchase book is ____________ to Purchase Account.
(a) posted
(b) moved
(c) given
(d) entered
Answer: (a) posted
In simple words: The periodic total from the Purchases Book is transferred, or 'posted', as a single entry to the Purchases Account in the ledger.

🎯 Exam Tip: This question highlights the connection between subsidiary books (like the Purchase Book) and the main ledger accounts.

 

Question 7. Real account always shows ____________ balance.
(a) minimum
(b) maximum
(c) debit
(d) credit
Answer: (c) debit
In simple words: Real accounts, which represent assets, typically show a debit balance as assets increase with debits.

🎯 Exam Tip: Recalling the rule that real accounts (assets) usually have debit balances is key to understanding account types.

 

Question 8. ____________ is prepared to test arithmetical accuracy of Books of Accounts.
(a) Trial Balance
(b) Ledger
(c) Journal
(d) List
Answer: (a) Trial Balance
In simple words: A Trial Balance is created to check if the total of all debit balances equals the total of all credit balances, confirming the mathematical accuracy of the ledger.

🎯 Exam Tip: Understanding the primary purpose of a Trial Balance - checking arithmetical accuracy - is essential for its definition.

4. State Whether The Following Statements Are 'True Or False' With Reasons.

Question 1. Ledger is a book of Original Entry.
Answer: This statement is False.
Ledger is a book of Secondary Entry.
Journal is a book of Original Entry: First, all transactions are recorded to journal or subsidiary books, and then they are pasted to the respective ledger accounts.
In simple words: The ledger is a book of secondary entry because transactions are first recorded in the journal (original entry) and then summarized in the ledger.

🎯 Exam Tip: Distinguishing between books of original and secondary entry is a foundational concept in the accounting cycle.

 

Question 2. The process of recording a transaction in the Journal is called Posting.
Answer: This statement is False.
The process of recording a transaction in the Journal is called Journalising. Posting means transferring journal entries to respective ledger accounts.
In simple words: Recording transactions in the journal is called 'journalizing,' while 'posting' is specifically moving those entries to the ledger.

🎯 Exam Tip: Clearly differentiating 'journalizing' and 'posting' is crucial for understanding the chronological flow of accounting information.

 

Question 3. A cash withdrawal from business by the trader should be credited to Drawings A/c.
Answer: This statement is False.
Cash withdrawn from the business by the trader should be debited to Drawing A/c. It is a personal account and as per the golden rules of a personal account Debit the receiver.
In simple words: When the owner takes cash from the business, the Drawings Account is debited because the owner is receiving assets from the business.

🎯 Exam Tip: Applying the golden rule of personal accounts (Debit the Receiver) to 'Drawings' is key for accurate accounting entries.

 

Question 4. Balances of Nominal Accounts are carried forward to the next year.
Answer: This statement is False.
Balances of Nominal Accounts are transferral to Trading and Profit and loss accounts of the year to find Gross Profit and Net Profit.
In simple words: Nominal accounts (expenses and incomes) are closed at the end of the financial year by transferring their balances to the Trading and Profit & Loss Accounts, not carried forward.

🎯 Exam Tip: Understanding the closure of nominal accounts at year-end is fundamental to preparing accurate final accounts and determining profitability.

 

Question 5. When the debit side of an account is greater than the credit side, the account shows a debit balance.
Answer: This statement is True.
While balancing the ledger account the side which is greater is the balance of that account so when the debit side of an account is greater the account shows debit balances.
In simple words: If the total debits in an account exceed the total credits, the account will have a debit balance, indicating a net amount on the debit side.

🎯 Exam Tip: This principle is central to interpreting account balances and correctly preparing a trial balance.

 

Question 6. The name of an account written on top of each account is called 'Head of Account'.
Answer: This statement is True.
There are many ledger accounts in the ledger book. To identity, the name of the account, every account on the Top Head of Account is written.
In simple words: The 'Head of Account' is simply the title or name of each individual account displayed at the top of its respective ledger page.

🎯 Exam Tip: Identifying the 'Head of Account' reinforces organizational aspects of ledger keeping.

 

Question 7. Agreement of Trial Balance always proves accounting accuracy.
Answer: This statement is False.
Even though the Trial balance is tally there may be some mistake like the complete omission of transaction or compensatory error so Agreement of Trial Balance does not always prove accounting accuracy.
In simple words: A Tallying Trial Balance only confirms mathematical equality of debits and credits, but it doesn't detect errors like a completely omitted transaction or a compensatory error where two errors cancel each other out.

🎯 Exam Tip: This question highlights the limitations of a trial balance in detecting all types of accounting errors.

 

Question 8. The trial balance is based on the double-entry principle that for every debit there is an equal amount of corresponding credit.
Answer: This statement is True.
Trial balance is an extract of ledger balances. Ledger is prepared of journal book which follows the Double Entry System of book-keeping. When both the effects of debit and credit with equal amount is given. The trial balance will be tally.
In simple words: The fundamental principle of double-entry accounting ensures that every transaction has equal debits and credits, which is why a correctly prepared trial balance should always show matching totals.

🎯 Exam Tip: This statement underscores the core principle of double-entry system, which is the foundation for trial balance preparation.

5. Fill In The Blanks.

Question 1. ____________ Balance on Nominal Account shows expenses or loss.
Answer: debit
In simple words: A debit balance in a nominal account typically indicates an expense or a loss.

🎯 Exam Tip: Remembering that expenses and losses (nominal accounts) are usually debited helps in understanding their balance type.

 

Question 2. Cash account always shows ____________ balance.
Answer: debit
In simple words: As cash is an asset, its account will always have a debit balance, reflecting the amount of cash on hand.

🎯 Exam Tip: This reinforces the rule that asset accounts always have a debit balance, as you cannot spend more cash than you possess.

 

Question 3. The right hand side of an account is called ____________ side.
Answer: credit
In simple words: In a T-account format, the right-hand side is consistently designated as the credit side.

🎯 Exam Tip: Knowing the layout of a T-account (debit on left, credit on right) is fundamental to ledger understanding.

 

Question 4. Creditors shows ____________ balance.
Answer: credit
In simple words: Creditors accounts show a credit balance because creditors are individuals or entities to whom the business owes money, representing a liability.

🎯 Exam Tip: This question tests the understanding that liabilities (like amounts owed to creditors) typically have credit balances.

 

Question 5. ____________ accounts are closed by transferring its balances to Profit and Loss Account.
Answer: Nominal
In simple words: Nominal accounts, which represent incomes and expenses, are temporary accounts closed at year-end by transferring their balances to the Profit and Loss Account.

🎯 Exam Tip: This question highlights the treatment of nominal accounts at the end of an accounting period, crucial for financial reporting.

 

Question 6. 'b/d' means ____________
Answer: brought down
In simple words: 'b/d' is an abbreviation for 'brought down,' indicating that a balance is carried over from the previous period to the current period.

🎯 Exam Tip: Understanding accounting abbreviations like 'b/d' and 'c/d' is essential for correct ledger interpretation.

 

Question 7. Rent paid for the residential quarter will be debited to ____________ account.
Answer: Drawings
In simple words: Rent paid for the owner's personal residential quarter is considered a personal expense of the owner, thus debited to the Drawings account.

🎯 Exam Tip: This question tests the 'separate entity concept,' distinguishing business expenses from owner's personal expenses.

 

Question 8. Sold goods of Rs. 24,000 at 20% Profit on cost, the purchase price of the goods is ____________
Answer: Rs. 20,000
In simple words: If goods are sold for Rs. 24,000 at a 20% profit on cost, the cost price is calculated as Rs. 24,000 / 1.20, which equals Rs. 20,000.

🎯 Exam Tip: This problem requires calculating cost price from selling price and profit percentage, a common financial arithmetic skill.

6. Complete The Following Table.

Question 1.

Journal	Journalising
?	Posting

Answer: Ledger
In simple words: Journalizing is the process of entering transactions into the journal, and similarly, posting is the process of entering transactions into the ledger.

🎯 Exam Tip: This table tests the matching of books of account with their respective recording processes.

 

Question 2.

Sales Return	Return Inward
Purchase Return	?

Answer: Return outward
In simple words: Sales return refers to goods returned by customers (return inward), while purchase return refers to goods returned by the business to suppliers (return outward).

🎯 Exam Tip: Knowing the alternative names for sales returns and purchase returns is important for interpreting accounting terminology.

 

Question 3.

L.F.	Journal
?	Ledger

Answer: J.F.
In simple words: L.F. (Ledger Folio) in the journal points to the ledger, and J.F. (Journal Folio) in the ledger points back to the journal, facilitating cross-referencing.

🎯 Exam Tip: This question tests understanding of journal and ledger folio cross-references.

 

Question 4.

Assets	Debit Balance
Liabilities	?

Answer: Credit balance
In simple words: Assets typically have a debit balance, while liabilities, by their nature, usually have a credit balance.

🎯 Exam Tip: This is a fundamental concept in accounting: assets are debits, liabilities and equity are credits.

 

Question 5.

Land & Building	Real Account
Commission Received	?

Answer: Nominal A/c
In simple words: Land and Building are real accounts (assets), whereas Commission Received is an income and thus falls under nominal accounts.

🎯 Exam Tip: Correctly classifying accounts into Real, Personal, and Nominal types is essential for applying debit and credit rules.

7. Put '4' mark for the nature of balance for the following.

Question 1.

Account	Dr. Balance	Cr. Balance
1) Capital A/c
2) Goodwill
3) Bank Overdraft
4) Bills Receivable
5) Creditors
6) Drawings
7) Advertisement
8) Prepaid Rent
9) Outstanding Salary
10) Bad debts

Answer:

Account	Dr. Balance	Cr. Balance
1. Capital A/c		4
2. Goodwill	4
3. Bank Overdraft		4
4. Bills Receivable	4
5. Creditors		4
6. Drawings	4
7. Advertisement	4
8. Prepaid Rent	4
9. Outstanding Salary		4
10. Bad debts	4

In simple words: Capital, Bank Overdraft, Creditors, and Outstanding Salary are liabilities or provisions which usually have credit balances, while Goodwill, Bills Receivable, Drawings, Advertisement, Prepaid Rent, and Bad Debts are assets or expenses which typically have debit balances.

🎯 Exam Tip: Accurately classifying accounts and knowing their normal balance (debit or credit) is foundational for preparing a trial balance and financial statements.

Practical Problems

Question 1. Give Journal entries of the following posting from the ledger account.
In the books of Sopan

Dr. Cash Account Cr.

Date	Particulars	J.F.	Amt (Rs.)	Date	Particulars	J.F.	Amt (Rs.)
2019 Feb. 1	To balance b/d		8,000	2019 Feb. 5	By Telephone Charges A/c		750
3	To Sales A/c		700	9	By Purchases A/c		800
6	To Interest A/c		600	28	By Balance c/d		9,250
8	To Jayashree's A/c		1,500
			10,800				10,800
Mar. 1	To Balance b/d		9,250

Dr. Purchases Account Cr.

Date	Particulars	J.F.	Amt (Rs.)	Date	Particulars	J.F.	Amt (Rs.)
2019 Feb. 9	To Cash A/c		800	2019 Feb.28	By Balance c/d		800
			800				800
Mar. 1	To Balance b/d		800

Dr. Jayashree's Account Cr.

Date	Particulars	J.F.	Amt (Rs.)	Date	Particulars	J.F.	Amt (Rs.)
2019 Feb. 15	To Sales A/c		5,000	2016 Feb. 8	By Cash A/c		1,500
				28	By Balance c/d		3,500
			5,000				5,000
Mar. 1	To Balance b/d		3,500

ℹ️ चित्र व्याख्या (Diagram Explanation): यहाँ तीन लेजर खाते दिए गए हैं - नकद खाता (Cash Account), खरीद खाता (Purchases Account), और जयश्री का खाता (Jayashree's Account)। प्रत्येक खाते में डेबिट और क्रेडिट दोनों तरफ की प्रविष्टियाँ और उनके अंतिम शेष (Balance c/d) दर्शाए गए हैं, जो फरवरी 2019 के लेनदेन को दर्शाते हैं। इन लेजर प्रविष्टियों से जर्नल प्रविष्टियाँ तैयार करनी हैं।
Answer:

Solution: Journal of Sopan

Date	Particulars	L.F. No.	Debit Amount (Rs.)	Credit Amount (Rs.)
2019 Feb. 3	Cash A/c Dr. To Sales A/c (Being cash received on sale of goods)		700	700
5	Telephone Charges A/c Dr. To Cash A/c (Being telephone charges of the business paid in cash)		750	750
6	Cash A/c Dr. To Interest A/c (Being Internet received in cash)		600	600
8	Cash A/c Dr. To Jayashree's A/c (Being cash received from Jayashree's on account)		1,500	1,500
9	Purchases A/c Dr. To Cash A/c (Being goods purchased on cash)		800	800
15	Jayashree's A/c Dr. To Sales A/c (Being goods sold to Jayashree on credit)		5,000	5,000
Total			9,350	9,350

In simple words: This journal summarizes various transactions for Sopan, including cash sales, payment of telephone charges, receipt of interest and cash from Jayashree, cash purchases, and credit sales to Jayashree. Each entry follows the double-entry system, ensuring debits equal credits.

🎯 Exam Tip: When preparing journal entries from ledger accounts, carefully identify the accounts debited and credited for each transaction and ensure the correct amounts are posted.

 

Question 2. Prepare necessary Ledger Accounts from the following Subsidiary Books.

Purchase Book

Date	Particulars	Inward Invoice No.	L.F.	Amount (Rs.)
2019 Oct. 2	Amol			7,500
7	Aishwarya			2,400
11	Vivek			3,900
17	Sheth			6,500
27	Shabari			1,000
Total				21,300

Purchase Return Book

Date	Particulars	Debit Note No.	L.F.	Amount (Rs.)
2019 Oct. 10	Aishwarya			480
20	Sheth			650
28	Shabari			200
Total				1,330

ℹ️ चित्र व्याख्या (Diagram Explanation): यहाँ दो सहायक पुस्तकें दी गई हैं - खरीद पुस्तक (Purchase Book) और खरीद वापसी पुस्तक (Purchase Return Book)। खरीद पुस्तक में अक्टूबर 2019 की विभिन्न पार्टियों से हुई कुल खरीद (Rs. 21,300) का विवरण है, जबकि खरीद वापसी पुस्तक में उसी महीने की पार्टियों को लौटाई गई कुल खरीद वापसी (Rs. 1,330) का विवरण है। इन पुस्तकों से आवश्यक लेजर खाते तैयार करने हैं।
Answer:

Solution: In the Ledger of

Dr. Purchases Account Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 Oct. 31	To Sundries as per purchases book		21,300	2019 Oct. 31	By Balance c/d		21,300
			21,300				21,300
2019 Mar. 1	To Balance b/d		21,300

Dr. Purchases Return A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 Oct. 31	To Balance c/d		1,330	2019 Oct. 31	By Sundries as per Purchases Return A/c		1,330
			1,330				1,330
2019 Mar. 1	To Balance b/d		1,330

Dr. Amol's A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
				2019 Oct. 2	By Purchases A/c		7,500
			7,500				7,500
2019 Oct. 31	To Balance c/d		7,500

Dr. Aishwarya's A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 Oct. 10	To Purchases Return A/c		480	2019 Oct. 7	By Purchases A/c		2,400
Oct. 31	To Balance c/d		1,920
			2,400				2,400

Dr. Vivek's A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 Oct. 31	To Balance c/d		3,900	2019 Oct. 11	By Purchases A/c		3,900
			3,900				3,900

Dr. Sheth's A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 Oct. 20	To Purchases Return A/c		650	2019 Oct. 17	By Purchases A/c		6,500
Oct. 31	To Balance c/d		5,850
			6,500				6,500

Dr. Shabari's A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 Oct. 28	To Purchases Return A/c		200	2019 Oct. 27	By Purchases A/c		1,000
Oct. 31	To Balance c/d		800
			1,000				1,000

In simple words: These ledger accounts show the individual purchase transactions and returns for Amol, Aishwarya, Vivek, Sheth, and Shabari, derived from the subsidiary books. Each account is balanced at month-end to determine the closing balance, which is then carried forward.

🎯 Exam Tip: When preparing ledger accounts from subsidiary books, ensure each entry is accurately posted to the correct side (debit/credit) of the relevant account, and that all accounts are properly balanced.

 

Question 3. From the following transactions prepare necessary Ledger Accounts in the Books of Vinay and balance the same.
2019 Jan.
(i) 1 Started business with Cash Rs. 10,000

 

Question 4. Journalise the following transactions and prepare Cash A/c only.
2019 July
1 Hardik started the business with Cash Rs. 15,000 and Machinery Rs. 20,000.
4 Purchased goods for Rs. 9,000 less 10% Cash Discount.
9 Sold goods to Amar Rs. 3,000.
12 Distributed goods worth Rs. 700 as free samples.
14 Bought Stationery for Rs. 550 for office use.
18 Received Rs.950 from Dhanashree, a customer, whose account was earlier written off as a bad debt.
21 Abhiram invoiced us goods worth Rs. 3,000.
24 Settled Abhiram's account, he allowed 5% cash discount.
27 Exchanged goods worth Rs. 2,500 against Furniture of the same amount.
29 Withdrawn cash from ATM Rs. 5,000 for office use and Rs. 3,000 for personal use.
Answer:
Solution:
Journal of Hardik

Date	Particulars	L.F. No.	Debit Amount (Rs.)	Credit Amount (Rs.)
2019 July 1	Cash A/c Machinery A/c To Capital A/c (Being business started with Cash and Machinery)	Dr. Dr.	15,000 20,000	35,000
4	Purchases A/c To Cash A/c To Discount A/c (Being goods purchased on cash basis and 10% cash discount earned)	Dr.	9,000	8,100 900
9	Amar's A/c To Sales A/c (Being goods sold to Amar on credit)	Dr.	3,000	3,000
12	Advertisement A/c To Goods distributed as free samples A/c (Being goods distributed as free samples to the people)	Dr.	700	700
14	Stationery A/c To Cash A/c (Being stationery purchased and cash paid)	Dr.	550	550
18	Cash A/c To Bad debts recovery A/c (Being bad debts recovered from Dhanashree)	Dr.	950	950
21	Purchases A/c To Abhiram's A/c (Being goods purchased on credit from Abhiram)	Dr.	3,000	3,000
24	Abhiram's A/c To Cash A/c To Discount A/c (Being cash paid and discount earned)	Dr.	3,000	2,850 150
27	Furniture A/c To Sales A/c (Being goods exchanged against furniture)	Dr.	2,500	2,500
31	Cash A/c Drawings A/c To Bank A/c (Being cash withdrawn from bank for office use and personal use)	Dr. Dr.	5,000 3,000	8,000
Total			65,700	65,700

Ledger of Hardik

Dr. Cash A/c Cr.

Date	Particulars	J.F. No.	Amt (Rs.)	Date	Particulars	J.F. No.	Amt (Rs.)
2019 Jan. 1	To Capital A/c		15,000	2019 Jan. 4	By Purchases A/c		8,100
18	To Bad debts Recovery A/c		950	14	By Stationery A/c		550
29	To Bank A/c		5,000	24	By Abhiram's A/c		2,850
				31	By Balance c/d		9,450
			20,950				20,950
2019 Feb. 1	To Balance b/d		9,450

In simple words: This solution demonstrates how to record various business transactions in a journal and then transfer them to the Cash Account in the ledger. It covers initial capital, purchases, sales, expenses, bad debt recovery, and withdrawals, showing the double-entry impact of each transaction.

🎯 Exam Tip: Focus on accurately identifying the debit and credit aspects of each transaction and correctly applying the rules of journalising and posting to ledger accounts, especially for Cash A/c. Pay close attention to discounts and personal/office use distinctions.

 

Question 5. Prepare Aparna's account in the books of Suparna.
2019 Jan.
1 Balance due from Aparna Rs. 60,000
4 Sold goods to Aparna Rs. 15,000 at 10% Trade Discount.
7 Goods returned by Aparna Rs. 1,500 (Gross)
11 Received crossed cheque from Aparna Rs. 50,000
17 Invoiced goods to Aparna Rs. 12,000
25 Sold goods to Aparna in cash Rs. 6,000
30 Received cash from Aparna Rs. 33,000 in full settlement of her account.
Answer:
Solution:
Ledger of Suparna

Dr. Aparna's A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 Jan. 1	To Balance b/d		60,000	2019 Jan. 7	By Sales Return A/c		1,350
4	To Sales A/c		13,500	11	By Bank A/c		50,000
17	To Sales A/c		12,000	30	By Cash A/c		33,000
				30	By Discount A/c		1,150
			85,500				85,500

Working Notes:
Jan. 4:
Trade discount = 10% on Rs. 15,000
= \( \frac{10}{100} \times \text{Rs. } 15,000 \)
= Rs. 1,500
Net Selling Price = Catalogue price - Trade discount
= 15,000 - 1,500
= Rs. 13,500
In simple words: This solution shows how to prepare Aparna's account in the books of Suparna, recording all credit transactions involving Aparna, including sales, returns, and payments, to determine the final balance. It highlights the impact of trade discounts on the net selling price.

🎯 Exam Tip: Remember to correctly apply trade discounts before recording sales and to account for returns and cash/bank receipts on the credit side. Ensure that the account is properly balanced at the end of the period.

 

Question 6. Prepare Cash A/c, Bank A/c, Purchases A/c, Sales A/c, and Capital A/c and balance the same in the books of Madanlal.
2019 Aug.
1 Started business with a bank balance of Rs. 40,000.
2 Purchased goods from Aseem worth Rs. 15,000 less 10% Trade Discount.
3 Sold goods to Arun for Rs. 8,000 in cash.
4 Paid Rent Rs. 3,000 and Electricity bill Rs. 500.
5 Purchased 100 Shares of Perfect Technologies for Rs. 55 per share and paid Brokerage Rs. 250 by transfer through net banking.
6 Withdrawal of goods for personal use Rs. 500.
7 Sold goods for cash Rs. 5,000 less 10% Cash Discount.
8 Deposited cash into Bank Rs. 2,000.
9 Paid Rs. 3,000 for daughter's tuition fees by Debit Card.
10 Purchased a Table for Rs. 2,000.
19 Received Rs. 1,500 by selling the scrap.
27 Paid cash into a bank in excess of Rs. 2,000
Answer:
Solution:
In the Ledger of Madanlal

Dr. Cash A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 Aug. 3	To Sales A/c		8,000	2019 Aug. 4	By Rent A/c		3,000
7	To Sales A/c		4,500	4	By Electricity A/c		500
19	To Sale of Scrap A/c		1,500	8	By Bank A/c		2,000
				10	By Furniture A/c		2,000
				27	By Bank A/c		4,500
				31	By Balance c/d		2,000
			14,000				14,000
2019 Sept. 1	To Balance b/d		2,000

Dr. Bank A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 Aug. 1	To Capital A/c		40,000	2019 Aug. 5	By Investment in Shares A/c		5,750
8	To Cash A/c		2,000	9	By Drawings A/c		3,000
31	To Cash A/c		4,500	31	By Balance c/d		37,750
			46,500				46,500
2019 Sept. 1	To Balance b/d		37,750

Dr. Purchases A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 Aug. 2	To Aseem's A/c		13,500	2019 Aug. 6	By Drawings A/c		500
				31	By Balance c/d		13,000
			13,500				13,500
2019 Sept. 1	To Balance b/d		13,000

Dr. Sales A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 Aug. 31	To Balance c/d		13,000	2019 Aug. 3	By Cash A/c		8,000
				7	By Cash A/c		4,500
				7	By Discount A/c		500
			13,000				13,000
2019 Sept. 1	By Balance b/d						13,000

Dr. Capital A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 Aug. 31	To Balance c/d		40,000	2019 Aug. 1	By Bank A/c		40,000
			40,000				40,000
2019 Sept. 1	By Balance b/d						40,000

In simple words: This solution demonstrates how to record various business transactions for Madanlal's business in different ledger accounts such as Cash, Bank, Purchases, Sales, and Capital, and then balance each account. It covers starting capital, purchases, sales, expenses, and personal withdrawals.

🎯 Exam Tip: When preparing multiple ledger accounts, ensure each transaction is posted to the correct accounts (debit and credit sides) and that all accounts are meticulously balanced at the end of the accounting period to prepare for a trial balance.

 

Question 7. Journalise the following transactions; post them into Ledger for February 2019
1 Sunil Started business with a stock of goods Rs. 20,000 and Cash Rs. 1,70,000 out of which Rs. 50,000 borrowed from his friend Kedar @ 10 p.a.
5 Placed an order for goods worth Rs. 7,000 with Mohan for which an advance of Rs. 5,500 was paid.
9 Purchased Stationery for office use Rs. 4,500
12 Goods distributed as free samples Rs. 2,000
17 Paid Freight Rs. 400 on behalf of Mr. Dev.
24 Received Goods from Mohan as per our order dated 5th Feb and settled his account.
27 Bought goods from Shekhar on two months credit for Rs. 7,000 at 20% Trade Discount with instructions to send them to Sagar.
28 Sent to Sagar Outward Invoice for goods supplied by Shekhar, at list price less 10% Trade Discount.
Answer:
Solution:
Journal of Sunil

Date	Particulars	L.F. No.	Debit Amount (Rs.)	Credit Amount (Rs.)
2019 Feb. 1	Stock of Goods A/c Cash A/c To Kedar's Loan A/c To Capital A/c (Being business started with stock of goods, borrowing and cash in hand)	Dr. Dr.	20,000 1,70,000	50,000 1,40,000
5	Advance to Mohan A/c To Cash A/c (Being advance paid against order of goods worth Rs. 7,000)	Dr.	5,500	5,500
9	Stationery A/c To Cash A/c (Being stationery purchased and cash paid)	Dr.	4,500	4,500
12	Advertisement A/c To Goods distributed as free samples A/c (Being goods distributed as free samples)	Dr.	2,000	2,000
17	Mr. Dev's A/c To Cash A/c (Being freight paid on behalf of Mr. Dev)	Dr.	400	400
24	Purchases A/c To Advance to Mohan A/c To Cash A/c (Being order for purchase of goods executed and balance amount paid)	Dr.	7,000	5,500 1,500
27	Goods sent to Sagar's A/c To Shekhar's A/c (Being good purchased on credit and sent to Sagar)	Dr.	5,600	5,600
28	Sagar's A/c To Sales A/c (Being goods sold to Sagar on credit @ 10% Trade discount)	Dr.	6,300	6,300
Total			2,21,300	2,21,300

Ledger of Sunil

Dr. Stock of Goods A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 Feb. 1	To Capital A/c		20,000	2019 Feb. 28	By Balance c/d		20,000
			20,000				20,000
2019 March 1	To Balance b/d		20,000

Dr. Cash A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 Feb. 1	To Kedar's Loan A/c		50,000	2019 Feb. 5	By Advance to Mohan A/c		5,500
1	To Capital A/c		1,20,000	9	By Stationery A/c		4,500
				17	By Mr. Dev's A/c		400
				24	By Purchases A/c		1,500
				28	By Balance c/d		1,58,100
			1,70,000				1,70,000
2019 March 1	To Balance b/d		1,58,100

Dr. Kedar's Loan A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 Feb. 28	To Balance c/d		50,000	2019 Feb. 1	By Cash A/c		50,000
			50,000				50,000
2019 March 1	To Balance b/d						50,000

Dr. Capital A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 Feb. 28	To Balance c/d		1,40,000	2019 Feb. 1	By Stock of Goods A/c		20,000
				1	By Cash A/c		1,20,000
			1,40,000				1,40,000
2019 March 1	To Balance b/d						1,40,000

Dr. Advance to Mohan A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 Feb. 5	To Cash A/c		5,500	2019 Feb. 24	By Purchases A/c		5,500
			5,500				5,500

Dr. Stationery A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 Feb. 9	To Cash A/c		4,500	2019 Feb. 28	By Balance c/d		4,500
			4,500				4,500
2019 March 1	To Balance b/d		4,500

Dr. Advertisement A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 Feb. 12	To Goods distributed as free samples A/c		2,000	2019 Feb. 28	By Balance c/d		2,000
			2,000				2,000
2019 March 1	To Balance b/d		2,000

Dr. Goods distributed as free samples A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 Feb. 28	To Balance c/d		2,000	2019 Feb. 12	By Advertisement A/c		2,000
			2,000				2,000
2019 March 1	By Balance b/d						2,000

Dr. Mr. Dev's A/c Cr

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 Feb. 17	To Cash A/c		400	2019 Feb. 28	By Balance c/d		400
			400				400
2019 March 1	To Balance b/d		400

Dr. Purchases A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 Feb. 24	To Advance to Mohan A/c		5,500	2019 Feb. 28	By Balance c/d		7,000
24	To Cash A/c		1,500
			7,000				7,000
2019 March 1	To Balance b/d		7,000

Dr. Goods sent to Sagar's A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 Feb. 27	To Shekhar's A/c		5,600	2019 Feb. 28	By Balance c/d		5,600
			5,600				5,600
2019 March 1	To Balance b/d		5,600

Dr. Shekhar's A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 Feb. 28	To Balance c/d		5,600	2019 Feb. 27	By Goods sent to Sagar's A/c		5,600
			5,600				5,600
2019 March 1	By Balance b/d						5,600

Dr. Sagar's A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 Feb. 28	To Sales A/c		6,300	2019 Feb. 28	By Balance c/d		6,300
			6,300				6,300
2019 March 1	To Balance b/d		6,300

Dr. Sales A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 Feb. 28	To Balance c/d		6,300	2019 Feb. 28	By Sagar's A/c		6,300
			6,300				6,300
2019 March 1	By Balance b/d						6,300

In simple words: This solution demonstrates the complete accounting cycle for Sunil's business, starting with journalizing various transactions, then systematically posting them to individual ledger accounts. It covers a wide range of business events from capital introduction to sales, purchases, and expenses, ensuring that each financial activity is recorded with its corresponding debit and credit impacts.

🎯 Exam Tip: For comprehensive problems involving both journalizing and ledger posting, meticulously track each transaction from the journal to the correct debit/credit side of the respective ledger accounts. Pay special attention to opening balances and closing balances to ensure accuracy.

 

Question 8. Journalise the following transactions and Prepare ledger accounts in the books of Sanjeev.
2019 June
1 Cash Received from Raju Rs. 10,000 for commission.
3 Intra-state sale to Rakesh Rs. 3,000 and SGST @ 2.5% and CGST @ 2.5% applicable.
5 Received full amount from Rakesh.
8 Intra-state purchases from Mangesh Rs. 2,000 and SGST @ 2.5% and CGST @ 2.5% applicable.
11 Paid the necessary amount to Mangesh.
18 Paid Rent Rs. 2,500
24 Paid mobile bill Rs. 1,000 out of which Rs. 700 for office use and for Rs. 300 for personal use.
Answer:
Solution:
Journal of Sanjeev

Date	Particulars	L.F. No.	Debit Amount (Rs.)	Credit Amount (Rs.)
2019 June 1	Cash A/c To Commission A/c (Being commission received in cash)	Dr.	10,000	10,000
3	Rakesh's A/c To Sales A/c To Output CGST A/c To Output SGST A/c (Being intra sale made to Rakesh with 2.5% CGST and 2.5% SGST on credit)	Dr.	3,150	3,000 75 75
5	Cash A/c To Rakesh's A/c (Being sales proceeds received from Rakesh)	Dr.	3,150	3,150
8	Purchases A/c Input CGST A/c Input SGST A/c To Mangesh's A/c (Being intra purchases with 2.5% CGST and 2.5% SGST on credit)	Dr. Dr. Dr.	2,000 50 50	2,100
11	Mangesh's A/c To Cash A/c (Being cash paid to Mangesh and settled his account)	Dr.	2,100	2,100
18	Rent A/c To Cash A/c (Being rent paid in cash)	Dr.	2,500	2,500
24	Mobile bill expenses A/c Drawings A/c To Cash A/c (Being mobile bill expenses of office and personal paid in cash)	Dr. Dr.	700 300	1,000
Total			26,100	26,100

In the Ledger of Sanjeev

Dr. Cash A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 June 1	To Commission A/c		10,000	2019 June 11	By Mangesh's A/c		2,100
5	To Rakesh's A/c		3,150	18	By Rent A/c		2,500
				24	By Mobile bill expenses A/c		700
				24	By Drawings A/c		300
				30	By Balance c/d		7,550
			13,150				13,150
2019 July 1	To Balance c/d		7,550

Dr. Commission A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 June 30	To Balance c/d		10,000	2019 June 1	By Cash A/c		10,000
			10,000				10,000
2019 July 1	By Balance b/d						10,000

Dr. Rakesh's A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 June 3	To Sales A/c		3,000	2019 June 5	By Cash A/c		3,150
	To Output CGST A/c		75
	To Output SGSTA/c		75
			3,150				3,150

Dr. Sales A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 June 30	To Balance c/d		3,000	2019 June 3	By Rakesh's A/c		3,000
			3,000				3,000
2019 July 1	By Balance b/d						3,000

Dr. Output CGST A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 June 30	To Balance c/d		75	2019 June 3	By Rakesh's A/c		75
			75				75
2019 July 1	By Balance b/d						75

Dr. Output SGST A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 June 30	To Balance c/d		75	2019 June 3	By Rakesh's A/c		75
			75				75
2019 July 1	By Balance b/d						75

Dr. Purchases A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 June 8	To Mangesh's A/c		2,000	2019 June 30	By Balance c/d		2,000
			2,000				2,000
2019 July 1	To Balance b/d		2,000

Dr. Mangesh's A/c Cr

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 June 11	To Cash A/c		2,100	2019 June 8	By Purchases A/c		2,000
					By Input CGST A/c		50
					By Input SGST A/c		50
			2,100				2,100

Dr. Rent A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 June 18	To Cash A/c		2,500	2019 June 30	By Balance c/d		2,500
			2,500				2,500
2019 July 1	To Balance b/d		2,500

Dr. Mobile Bill Expenses A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 June 24	To Cash A/c		700	2019 June 30	By Balance c/d		700
			700				700
2019 July 1	To Balance b/d		700

Dr. Drawings A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 June 24	To Cash A/c		300	2019 June 30	By Balance c/d		300
			300				300
2019 July 1	To Balance b/d		300

Dr. Input CGST A/c Cr.

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 June 8	To Mangesh's A/c		50	2019 June 30	By Balance c/d		50
			50				50
2019 July 1	To Balance b/d		50

Dr. Input SGST A/c Cr

Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 June 8	To Mangesh's A/c		50	2019 June 30	By Balance c/d		50
			50				50
2019 July 1	To Balance b/d		50

In simple words: This solution demonstrates the complete accounting process for Sanjeev, starting with journalizing all transactions, including those with GST, and then posting them to respective ledger accounts like Cash, Commission, Rakesh, Sales, Purchases, Rent, Mobile Bill Expenses, Drawings, Input CGST, Input SGST, and Output CGST/SGST. Each account is then balanced to reflect its closing position.

🎯 Exam Tip: When dealing with GST, always remember to record Input GST on purchases and Output GST on sales. Ensure that personal expenses (drawings) are correctly separated from business expenses in the ledger accounts.

 

Question 9. The following ledger balances were extracted from the books of Pawan Pawar, Pune as of 1st July 2019.

Debit balances	Amt.(Rs.)	Credit balances	Amt.(Rs.)
Machinery	4,40,000	Purchase return	60,000
Rashmi's A/c	70,000	Sales	3,60,000
Purchases	1,30,000	Pawan's capital	4,80,000
Sales return	40,000	Interest	6,000
Cash	1,00,000	Rakesh's A/c	56,000
Bank	1,80,000
Stationery	2,000

The following transactions took place during July 2019. Post them into Ledger and prepare Trial Balance as of 31st July 2019.
1 Introduced additional Capital Rs. 40,000
4 Bought goods from Rakesh Rs. 80,000 @ 10% Trade Discount
7 Sold goods to Rashmi Rs. 30,000
9 Returned goods to Rakesh Rs. 20,000 (Gross)
11 Rashmi returned goods to us Rs. 400

 

Question 9. Journalise the following transactions and Prepare ledger accounts in the books of Sanjeev.

2019 June
1 Cash Received from Raju Rs. 10,000 for commission.
3 Intra-state sale to Rakesh Rs. 3,000 and SGST @ 2.5% and CGST @ 2.5% applicable.
5 Received full amount from Rakesh.
8 Intra-state purchases from Mangesh Rs. 2,000 and SGST @ 2.5% and CGST @ 2.5% applicable.
11 Paid the necessary amount to Mangesh.
18 Paid Rent Rs. 2,500
24 Paid mobile bill Rs. 1,000 out of which Rs. 700 for office use and for Rs. 300 for personal use.

Answer:
Solution:
Journal of Sanjeev

Date	Particulars	L.F. No.	Debit Amount (Rs.)	Credit Amount (Rs.)
2019 June 1	Cash A/c Dr. To Commission A/c (Being commission received in cash)		10,000	10,000
3	Rakesh's A/c Dr. To Sales A/c To Output CGST A/c To Output SGST A/c (Being intra sale made to Rakesh with 2.5% CGST and 2.5% SGST on credit)		3,150	3,000 75 75
5	Cash A/c Dr. To Rakesh's A/c (Being sales proceeds received from Rakesh)		3,150	3,150
8	Purchases A/c Dr. Input CGST A/c Dr. Input SGST A/c Dr. To Mangesh's A/c (Being intra purchases with 2.5% CGST and 2.5% SGST on credit)		2,000 50 50	2,100
11	Mangesh's A/c Dr. To Cash A/c (Being cash paid to Mangesh and settled his account)		2,100	2,100
18	Rent A/c Dr. To Cash A/c (Being rent paid in cash)		2,500	2,500
24	Mobile bill expenses A/c Dr. Drawings A/c Dr. To Cash A/c (Being mobile bill expenses of office and personal paid in cash)		700 300	1,000
	Total		26,100	26,100

In the Ledger of Sanjeev

Dr. Cash A/c Cr.
Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 June 1	To Commission A/c		10,000	2019 June 11	By Mangesh's A/c		2,100
5	To Rakesh's A/c		3,150	18	By Rent A/c		2,500
				24	By Mobile bill expenses A/c		700
				24	By Drawings A/c		300
			13,150	30	By Balance c/d		7,550
			13,150
2019 July 1	To Balance b/d		7,550

Dr. Commission A/c Cr.
Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 June 30	To Balance c/d		10,000	2019 June 1	By Cash A/c		10,000
			10,000				10,000
				2019 July 1	By Balance b/d		10,000

Dr. Rakesh's A/c Cr.
Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 June 3	To Sales A/c		3,000	2019 June 5	By Cash A/c		3,150
	To Output CGST A/c		75
	To Output SGSTA/c		75
			3,150				3,150

Dr. Sales A/c Cr.
Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 June 30	To Balance c/d		3,000	2019 June 3	By Rakesh's A/c		3,000
			3,000				3,000
				2019 July 1	By Balance b/d		3,000

Dr. Output CGST A/c Cr.
Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 June 30	To Balance c/d		75	2019 June 3	By Rakesh's A/c		75
			75				75
				2019 July 1	By Balance b/d		75

Dr. Output SGST A/c Cr.
Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 June 30	To Balance c/d		75	2019 June 3	By Rakesh's A/c		75
			75				75
				2019 July 1	By Balance b/d		75

Dr. Purchases A/c Cr.
Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 June 8	To Mangesh's A/c		2,000	2019 June 30	By Balance c/d		2,000
			2,000				2,000
				2019 July 1	To Balance b/d		2,000

Dr. Mangesh's A/c Cr.
Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 June 11	To Cash A/c		2,100	2019 June 8	By Purchases A/c		2,000
					By Input CGST A/c		50
					By Input SGST A/c		50
			2,100				2,100

Dr. Rent A/c Cr.
Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 June 18	To Cash A/c		2,500	2019 June 30	By Balance c/d		2,500
			2,500				2,500
				2019 July 1	To Balance b/d		2,500

Dr. Mobile Bill Expenses A/c Cr.
Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 June 24	To Cash A/c		700	2019 June 30	By Balance c/d		700
			700				700
				2019 July 1	To Balance b/d		700

Dr. Drawings A/c Cr.
Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 June 24	To Cash A/c		300	2019 June 30	By Balance c/d		300
			300				300
				2019 July 1	To Balance b/d		300

Dr. Input CGST A/c Cr.
Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 June 8	To Mangesh's A/c		50	2019 June 30	By Balance c/d		50
			50				50
				2019 July 1	By Balance b/d		50

Dr. Input SGST A/c Cr.
Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 June 8	To Mangesh's A/c		50	2019 June 30	By Balance c/d		50
			50				50
				2019 July 1	By Balance b/d		50

In simple words: This solution demonstrates how to record various business transactions in a journal and then post them to their respective ledger accounts, including accounts for cash, commission, sales, purchases, GST, rent, mobile expenses, drawings, and individual parties like Rakesh and Mangesh, maintaining the double-entry system.

🎯 Exam Tip: Accurately identifying debit and credit aspects for each transaction is crucial for correct journal entries and subsequent ledger posting, directly impacting the final balance of each account. Pay close attention to GST components for sales and purchases.

 

Question 9. The following ledger balances were extracted from the books of Pawan Pawar, Pune as of 1st July 2019.

Debit balances	Amt.(Rs.)	Credit balances	Amt.(Rs.)
Machinery	4,40,000	Purchase return	60,000
Rashmi's A/c	70,000	Sales	3,60,000
Purchases	1,30,000	Pawan's capital	4,80,000
Sales return	40,000	Interest	6,000
Cash	1,00,000	Rakesh's A/c	56,000
Bank	1,80,000
Stationery	2,000

The following transactions took place during July 2019. Post them into Ledger and prepare Trial Balance as of 31st July 2019.
1 Introduced additional Capital Rs. 40,000
4 Bought goods from Rakesh Rs. 80,000 @ 10% Trade Discount
7 Sold goods to Rashmi Rs. 30,000
9 Returned goods to Rakesh Rs. 20,000 (Gross)
11 Rashmi returned goods to us Rs. 400
14 Paid to Rakesh Rs. 40,000 @ 2% Cash Discount
22 Made purchases Rs. 17,000 and amount paid by cheque
24 Cash Sales Rs. 8,000
27 Bought Stationery Rs. 3,000
28 Received from Rashmi Rs. 39,000 by RTGS and discount allowed Rs. 1000
29 Paid Salary Rs. 10,000
29 Sold goods to Rashmi Rs. 20,000
31 Bought goods from Rakesh Rs. 36,000 and paid by cheque.

Answer:
Solution:
Ledger of Pawan Pawar, Pune

Dr. Machinery A/c Cr.
Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 July 1	To Balance b/d		4,40,000	2019 July 31	By Balance c/d		4,40,000
			4,40,000				4,40,000
2019 Aug 1	To Balance b/d		4,40,000

Dr. Rashmi's A/c Cr.
Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 July 1	To Balance b/d		70,000	2019 July 11	By Sales Returns A/c		400
7	To Sales A/c		30,000	28	By Bank A/c		39,000
29	To Sales A/c		20,000	28	By Discount A/c		1,000
				31	By Balance c/d		79,600
			1,20,000				1,20,000
2019 Aug. 1	To Balance b/d		79,600

Dr. Purchases A/c Cr.
Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 July 1	To Balance b/d		1,30,000	2019 July 31	By Balanced c/d		2,55,000
4	To Rakesh's A/c		72,000
22	To Bank A/c		17,000
31	To Bank A/c		36,000
			2,55,000				2,55,000
2019 Aug. 1	To Balance b/d		2,55,000

Dr. Sales Returns A/c Cr.
Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 July 1	To Balance b/d		40,000	2019 July 31	By Balanced c/d		40,400
11	To Rashmi's A/c		400
			40,400				40,400
2019 Aug. 1	To Balance b/d		40,400

Dr. Cash A/c Cr.
Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 July 1	To Balance b/d		1,00,000	2019 July 14	By Rakesh's A/c		39,200
1	To Capital A/c		40,000	27	By Stationery A/c		3,000
24	To Sales A/c		8,000	29	By Salary A/c		10,000
				31	By Balance c/d		95,800
			1,48,000				1,48,000
2019 Aug. 1	To Balance b/d		95,800

Dr. Bank A/c Cr.
Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 July 1	To Balance b/d		1,80,000	2019 July 22	By Purchases A/c		17,000
28	To Rashmi's A/c		39,000	31	By Purchases A/c		36,000
				31	By Balance c/d		1,66,000
			2,19,000				2,19,000
2019 Aug. 1	To Balance b/d		1,66,000

Dr. Stationery A/c Cr.
Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 July 1	To Balance b/d		2,000	2019 July 31	By Balance c/d		5,000
27	To Cash A/c		3,000
			5,000				5,000
2019 Aug. 1	To Balance b/d		5,000

Dr. Purchases Returns A/c Cr.
Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 July 31	To Balance c/d		78,000	2019 July 1	By Balance b/d		60,000
				9	By Rakesh's A/c		18,000
			78,000				78,000
2019 Aug. 1	By Balance b/d		78,000

Dr. Sales A/c Cr.
Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 July 31	To Balance c/d		4,18,000	2019 July 1	By Balance b/d		3,60,000
				7	By Rashmi's A/c		30,000
				24	By Cash A/c		8,000
				29	By Rashmi's A/c		20,000
			4,18,000				4,18,000
2019 Aug. 1	By Balance b/d		4,18,000

Dr. Capital A/c Cr.
Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 July 31	To Balance c/d		5,20,000	2019 July 1	By Balance b/d		4,80,000
				1	By Cash A/c		40,000
			5,20,000				5,20,000
2019 Aug. 1	By Balance b/d		5,20,000

Dr. Interest A/c Cr.
Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 July 31	To Balance c/d		6,000	2019 July 1	By Balance b/d		6,000
			6,000				6,000
2019 Aug. 1	By Balance b/d		6,000

Dr. Rakesh's A/c Cr.
Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 July 9	To Purchases Return A/c		18,000	2019 July 1	By Balance b/d		56,000
14	To Cash A/c		39,200	4	By Purchases A/c		72,000
14	To Discount A/c		800
31	To Balance c/d		70,000
			1,28,000				1,28,000
2019 Aug. 1	By Balance b/d		70,000

Dr. Discount A/c Cr.
Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 July 28	To Rashmi's A/c		1,000	2019 July 14	By Rakesh's A/c		800
				31	By Balance c/d		200
			1,000				1,000
2019 Aug. 1	To Balance b/d		200

Dr. Salary A/c Cr.
Date	Particulars	J.F. No.	Amt. (Rs.)	Date	Particulars	J.F. No.	Amt. (Rs.)
2019 July 29	To Cash A/c		10,000	2019 July 31	By Balance c/d		10,000
			10,000				10,000
2019 Aug. 1	To Balance b/d		10,000

Trial Balance as of 31st July 2019

Sr. No.	Particulars	L.F. No.	Debit Balances (Rs.)	Credit Balances (Rs.)
1	Machinery A/c		4,40,000
2	Rashmi's A/c		79,600
3	Purchases A/c		2,55,000
4	Sales Returns A/c		40,400
5	Cash A/c		95,800
6	Bank A/c		1,66,000
7	Stationery A/c		5,000
8	Purchases Returns A/c			78,000
9	Sales A/c			4,18,000
10	Capital A/c			5,20,000
11	Interest A/c			6,000
12	Rakesh's A/c			70,000
13	Discount A/c		200
14	Salary A/c		10,000
	Total		10,92,000	10,92,000

In simple words: This solution demonstrates how to update ledger accounts with opening balances and new transactions for July 2019, including capital, purchases, sales, returns, cash, bank, stationery, interest, and salary. Finally, it presents a Trial Balance to verify the arithmetical accuracy of the ledger balances.

🎯 Exam Tip: When preparing ledger accounts from initial balances and new transactions, ensure all opening balances are correctly brought down (b/d) and each transaction is posted twice (debit and credit). The Trial Balance is a critical step to check for mathematical accuracy before preparing final accounts, so careful balancing and totalling are essential.