Capital and Revenue — Account STD 11 Commerce — Question

Classify the following into Assets, Liabilities, Capital, Revenue, and Expenses:

i	Plant and Machinery	ii	Bank Loan
iii	Sales	iv	Rent
v	Discount Received	vi	Carriage Inwards
vii	Carriage outwards	viii	Purchases
ix	Bills Payable	x	Wages
xi	Advance Income	xii	Accrued Income
xiii	Goodwill	xiv	Furniture and Fixtures
xv	Outstanding Expenses	xvi	Capital.

Pass entries in the books of Sh. Jagdish Mishra of Lucknow (U.P.) assuming CGST @ 6% and SGST @ 6%.

2018
March 5	Purchased goods for ₹ 2,50,000 from Virender Yadav of Patna (Bihar).
March 12	Sold goods costing ₹ 60,000 at 50% profit to Partap Sinha of Ranchi (Jharkhand).
March 14	Purchased goods for ₹ 70,000 from Ram Nath of Kanpur (U.P.) against cheque.
March 18	Sold goods at Varanasi (U.P.) Costing ₹ 2,25,000 at 3313%3313%profit less trade discount 10% against cheque which was deposited into bank.
March 20	Paid rent ₹ 25,000 by cheque.
March 31	Payment made of balance amount of GST.

Ravi sold goods for ₹ 40,000 to Sudershan on Feb 13, 2016. He drew four bills of exchange upon Sudershan. The first bill was for ₹ 5,000 payable after one month. The second bill was for ₹ 10,000 payable after 40 days; the third bill was for ₹ 12,000 payable after three months and fourth bill was for the balance amount payable after 19 days. Sudershan accepted all the bills and returned the same to Ravi. Ravi discounted the first bill with his bank at 6% p.a. He endorsed the second bill to his creditor Mustaq for the full settlement of a debt of ₹ 10,200. The third bill was kept by Ravi with him till the date of maturity. Five days before the maturity of the fourth bill, Ravi sent the bill to his bank for collection. All the four bills were dishounoured by Sudarshan on maturity. Sudershan settled Ravi’s claim in cash three days after the dishonour of each bill along with interest @ 12% p.a. for the terms of the bills. You are requested to record the necessary journal entries in the books to Ravi, Sudershan, Mustaq and bank for the above transaction. Also prepare Sudershan’s account and Mustaq’s account in the books of Ravi.

Rectify the following errors assuming that a suspense account was opened. Ascertain the difference in trial balance.

1. Credit sales to Mohan ₹ 7,000 were posted to Karan as ₹ 5,000.
2. Credit purchases from Rohan ₹ 9,000 were posted to the debit of Gobind as ₹ 10,000.
3. Goods returned to Rakesh ₹ 4,000 were posted to the credit of Naresh as ₹ 3,000.
4. Goods returned from Mahesh ₹ 1,000 were posted to the debit of Manish as ₹ 2,000.
5. Cash sales ₹ 2,000 were posted to commission account as ₹ 200.

A drew a bill of ₹ 1,000 on B for 3 months which was duly accepted by the latter. A endorsed the bill to C in full payment of his own acceptance to C for a like amount. C endorsed the bill to B.
Pass the Journal entries in the books of A, B and C.

The accountant of a firm finds that the Trial Balance as on 31st March, 2019 is out by an excess debit of ₹ 283. He placed the amount in the Suspense Account. In the first week of April, 2019, he discovered the following errors. Pass the Journal entries necessary to rectify these errors and show the Suspense Account as it would appear at the end of the week. Have you any comment to make?

1. Cash paid to Amar Nath, ₹ 75, was posted to the credit of Amar Singh's Account as ₹ 57.
2. Discount allowed by Brijesh of ₹ 5 was not entered in the Cash Book but Brijesh stands debited correctly.
3. No entry was made for goods worth ₹ 40 taken away by proprietor for personal use.
4. ₹ 500 received from Jhaveri Bros. for interest on loan advanced to them were recorded in the Cash Book. But the entry was not posted in the Ledger.
5. The total of Returns Outward Book was short by ₹ 100.

Enter the following transactions in two Column cash book and find out the cash and bank balance:

2017		(₹)
Jan. 1	Started business with cash	20,000
Jan. 2	Opened a current account with the S.B.I.	8,000
Jan. 3	Bought goods by cheque	150
Jan. 4	Received cheque from Ram	200
Jan. 5	Sold goods for cash	40
Jan. 7	Paid into bank:
	(i) Cash ₹ 30
	(ii) Cheque ₹ 200	230
Jan. 8	Paid Shyam by cheque	345
Jan. 8	Paid carriage by cheque	180
Jan. 10	Drew cash from bank for office use	200
Jan. 30	Paid wages by cheque	60

From the following particulars, prepare a Bank Reconciliation Statement of Alpha Electronic Motor. Private Ltd. as on 30th September, 2014:

1. Overdraft on 30th September 2014 as per Pass Book ₹ 10,000.
2. Cheque deposited in the bank but not recorded in Cash Book ₹ 100.
3. Cheque received and recorded in the Cash Book but not sent to bank for collection ₹ 1,000.
4. Several cheques were drawn in the last week of September, totalling ₹ 15,000; of these cheques totalling only ₹ 9,000 were cashed before 30th September.
5. Similarly, several cheques, totaling ₹ 9,000 were sent for collection; of these cheques of the value of ₹ 1,500 were credited on 5th October and ₹ 2,000 on 7th October, balance being credited before 30th September.
6. Fees of ₹ 250 was paid directly by the bank but was not recorded in the Cash Book.
7. In the Cash Book, a bank charge of ₹ 30 was recorded twice while another bank charge of ₹ 50 was not recorded at all.
8. Interest of ₹ 1,400 was charged by the bank but was not recorded in the Cash Book.

Show the effect of the following transactions and also prepare a Balance Sheet:

1. Started business with cash ₹ 60,000.
2. Rent received ₹ 2,000.
3. Accrued interest ₹ 500.
4. Commission received in advance ₹ 1,000.
5. Amount withdrawn ₹ 5,000.

[Hint: Capital = Opening Capital ₹ 60,000 + Rent Received ₹ 2,000 + Accrued Interest ₹ 500 - Drawings ₹ 5,000 = ₹ 57,500.]