Problems on Journal Entries

1. By: Dr. Feeroj Pathan
COURSE CODE- BTHM705 2 Credits
UNIT- 1
• Introduction to Financial Accounting,
Book keeping & Recording:

3. JOURNAL AND LEDGER
• Journal is a simple book of accounts in which all
the business transactions are originally recorded
in chronological order and from which they are
posted to the ledger accounts at any convenient
time.
• Journalizing refers to the act of recording each
transaction in the journal and the form in which it
is recorded, is known as a journal entry.

4. FORMAT OF JOURNAL
In the Books of ……….
Journal Entries for the Month of ………
DATE PARTICULAR LF DR AMOUNT CR AMOUNT
1 2 3 4 5

5. Sub-division Of Journal
When innumerable number of transactions takes place, the journal, as
the sole book of the original entry becomes inadequate. Thus, the
number and type of journals required are determined by the nature of
operations and the volume of transactions in a particular business
1. Sales Day Book- to record all credit sales.
2. Purchases Day Book- to record all credit purchases.
3. Cash Book- to record all cash transactions of receipts as well as
payments.
4. Sales Returns Day Book- to record the return of goods sold to
customers on credit.
5. Purchases Returns Day Book- to record the return of goods
purchased from suppliers on credit.
6. Bills Receivable Book- to record the details of all the bills received.
7. Bills Payable Book- to record the details of all the bills accepted.
8. Journal Proper-to record all residual transactions which do not find
place in any of the aforementioned books of original entry.

6. Journal entries
Q.1 The following transactions are related to Dream
India Pvt. Ltd of Mr. Ashok for the month April 2022.
Pass the journal entries & post them into ledger.
• April 1- Mr. Ashok started business with cash Rs.
10,000, Machinery Rs. 12,000 & Building worth Rs.
15,000.
• April 3 – Open bank account by depositing Rs. 5,000.
• April 5- Purchase goods from Mr. Vishal worth Rs.
5,000.
• April 7- Sold goods worth Rs. 3,000/-.

7. • April 8- Sold goods worth Rs. 3,000/-.
• April 19- Cash withdraw from bank Rs. 1,000/-
• April 21 – Rent paid Rs. 2,000/-
• April 22 – Goods worth Rs. 2,000/- withdrawn for
personal purpose.
• April 24- Purchase machinery worth Rs. 10,000/-
• April 29- Sold goods to Mr. Ravi worth Rs. 2,000/-

8. Journal Entries in the books of Dream India Pvt. Ltd
For the month of April 2022
Date Particular L.F.
Debit
Amount
Credit
Amount
1-4-2022 Cash A/c Dr.
Machinery A/c Dr.
Building A/c Dr.
To Capital A/c
(Being business started with
Cash, Machinery & Building by
Mr. Ashok)
10,000
12,000
15,000
---
--
--
--
37,000
3-4-2022 Bank A/c Dr.
To Cash A/c
(Being bank account is
opened)
5,000
---
--
5,000

9. 5-4-2022 Goods A/c Dr.
To Vishal's A/c
(Being goods purchased from
Mr. Vishal)
5,000
---
--
5,000
7-4-2022 Cash A/c Dr.
To Goods A/c
(Being goods sold by cash)
3,000
---
--
3,000
8-4-2022 Amit's A/c Dr.
To Goods A/c
(Being goods sold to Mr. Amit)
3,000
---
--
3,000
19-4-2022 Cash A/c Dr.
To Bank A/c
(Being cash withdrawn from
bank)
1,000
---
--
1,000
21-4-2022 Rent A/c Dr.
To Cash A/c
(Being rent paid by cash)
2,000
---
--
2,000

10. 22-4-2022 Drawing A/c Dr.
To Goods A/c
(Being goods withdrawal for
personal use)
2,000
---
--
2,000
24-4-2022 Machinery A/c Dr.
To Cash A/c
(Being new machinery
purchased by cash)
10,000
---
--
10,000
29-4-2022 Ravis A/c Dr.
To Goods A/c
(Being goods sold to Mr. Ravi)
2,000
---
--
2,000
TOTAL 70,000 70,000

21. In the leger books of ------------
(For the month of -----------.)
Date Particular j.f Amount Date Particular j.f Amount

22. Cashbook
• Cash book records all
receipts and payments in
cash. Usually the deposits
into bank accounts
maintained by a business
firm, withdrawals from such
accounts and cheque
payments are also recorded
in the cash book.