Question

Prepare Journal from the transactions given below :
(a) Cash paid for installation of machine ₹500
(b) Goods given as charity ₹2000
(c) Interest charged on capital @ 7% p.a. when total capital were ₹70000
(d) Received 1,200 of a bad debts written-off last year.
(e) Goods destroyed by fire ₹2000
(f) Rent outstanding ₹1000. (g) Interest on drawings ₹900
(h) Sudhir Kumar who owed me ₹3000 has failed to pay the amount.He pays me a compensation of 45 paise in a rupee.
(i) Commission received in advance ₹7000.​

Answer 1

Answer:

Explanation:

a)Machine A/c     Dr     500

    To Cash A/c                 500

b)Charity A/c       Dr       2000

      To Purchases A/c        2000

c)Interest on Capital A/c   Dr   4900

      To Capital A/c                               4900

d)Cash/Bank A/c          Dr    1200

         To Bad debts Recovered A/c      1200

e)Loss by fire A/c   Dr   2000

      To Purchases A/c        2000

f)Rent A/c     Dr    1000

   To Outstanding Rent A/c   1000

g)Drawing A/c   Dr   900

       To Interest On drawing A/c   900

h)Cash A/c   Dr   1350

   Bad debts A/c  Dr  1650

         To Sudhir A/c            3000

(45 p in a rupee means the person is paying only 45% of the amount due and rest will be bad debts)

i) Cash A/c    Dr   7000

      To Commission received in advance a/c    7000