Introduction to Accounting — Account STD 11 Commerce — Question

Record the following transactions in the Purchases Book of Subhash General Stores, Delhi:

Mr. Chaturvedi maintains two bank accounts. Prepare his columnar cash book from the following particulars:

2016		(₹)
May 1	Cash in hand	34,000
	Balance with Hongkong Bank	75,200
	Balance with Citi Bank	1,20,000
May 3	Cash drawn from Citi Bank for office use	25,000
May 8	Sold goods to Diwedi for ₹ 80,000 and received from him ₹ 20,000 in cash and a cheque for the balance. The cheque is deposited in Hongkong Bank on 9th and the bank credited the amount on 15th and debited ₹ 25 as its collection charges.
May 12	Purchased goods for ₹ 40,000 at 20% trade discount. 25% of the amount is paid in cash and issued a cheque on Citi Bank for the balance amount.
May 20	Paid Wages ₹ 36,000 and Salary ₹ 4,000.
May 22	A cheque for ₹ 50,000 is drawn on Citi Bank and it is deposited in Hongkong Bank.
May 23	Purchased land for ₹ 3,20,000 and a cheque is issued on Hongkong Bank.
May 24	A cheque for ₹ 10,000 which was received from Mohan and was deposited in Citi Bank on 25th April is dishonoured and the bank debited ₹ 100 as bank charges on this cheque. The amount of dishonoured cheque and bank charges is received from Mohan in cash on 25th.
May 26	Deposited cash ₹ 30,000 in Hongkong Bank.
May 28	Sold old typewriter for ₹ 2,000 and old newspapers for ₹200 in cash.
May 30	Interest charged by Hongkong Bank ₹ 400.
May 31	Bank charges by Citi Bank ₹ 180 and Hongkong Bank ₹ 340.

Enter the following transactions in Return Outward Book of Modern Furniture House, Udaipur (Rajasthan) assuming CGST @ 6% and SGST @ 6% and post it into Ledger:

2017
Nov. 7	Returned to Sachdeva Furniture Store, Ahmedabad (Gujarat):
	5 Chairs @ ₹ 2,000 each
	1 Table for ₹ 15,000
	Less: 10% Trade Discount
Nov. 22	Returned 8 Chairs to India Furniture House, Jodhpur (Rajasthan) @ ₹ 1,500 each, being not of specified quality
Nov. 24	Returned one Dining Table to Arora & Co., Jaipur (Rajasthan) being not according to sample ₹ 50,000
Nov. 28	Allowance claimed from Delhi Furniture Shop, Ahmedabad (Gujarat) on account of mistake in the invoice ₹ 16,000

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

i	Land	ii	Investments
iii	Building	iv	Interest Received
v	Salary	vi	Bank Overdraft
vii	Debtors	viii	Creditors
ix	Bad Debts	x	Capital
xi	Depreciation	xii	Motor Vehicles
xiii	Freight	xiv	Wages
xv	Goodwill	xvi	Repairs.

Kapil purchased goods for ₹ 21,000 from Gaurav on 1.2.2017 and accepted a bill of exchange drawn by Gaurav for the same amount. The bill was payable after one month. On 25.2.2017 Gaurav sent the bill to his bank for collection. The bill was duly presented by the bank. Kapil dishonoured the bill and the bank paid ₹ 100 as noting charges. Record the necessary journal entries for the above transactions in the books of Kapil and Gourav.

Give journal entries of M/s. Mohit traders; post them to the Ledger from the following transactions:

August, 2017		₹
1	Commenced business with cash	1,10,000
2	Opened bank account with H.D.F.C.	50,000
3	Purchased furniture	20,000
7	Bought goods for cash from M/s. Rupa Traders	30,000
8	Purchased good from M/s. Hema Traders	42,000
10	Sold goods for cash	30,000
14	Sold goods on credit to M/s. Gupta Traders	12,000
16	Rent paid	4,000
18	Paid trade expenses	1,000
20	Received cash from Gupta Traders	12,000
22	Goods return to Hema Traders	2,000
23	Cash paid to Hema Traders	40,000
25	Bought postage stamps	100
30	Paid salary to Rishabh	4,000

Rectify the following errors assuming that Suspense Account was opened. Ascertain the difference in Trial Balance.

1. Credit sales to Mohan ₹ 7,000 were recorded in Purchase Book. However, Mohan's Account was correctly debited.
2. Credit purchases from Rohan ₹ 9,000 were recorded in Sales Book. However, Rohan's Account was correctly credited.
3. Goods returned to Rakesh ₹ 4,000 were recorded in Sale Returns Book. However, Rakesh's Account was correctly debited.
4. Goods returned from Mahesh ₹ 1,000 were recorded through Purchase Returns Book. However, Mahesh's Account was correctly credited.
5. Goods returned to Naresh ₹ 2,000 were recorded through Purchases Book. However, Naresh's Account was correctly debited.

Discuss in detail the straight line method and written down value method of depreciation. Distinguish between the two and also give situations where they are useful.

Use accounting equation to show the effect of the following transactions of M/s Royal Traders:

a.	Started business with cash	₹ 1,20.000
b.	Purchased goods for cash	₹ 10,000
c.	Rent received	₹ 5,000
d.	Salary outstanding	₹ 2,000
e.	Prepaid Insurance	₹ 1,000
f.	Received interest	₹ 700
g.	Sold goods for cash (Costing ₹ 5,000)	₹ 7,000
h.	Goods destroyed by fire	₹ 500

(Ans: Assets = Cash ₹ 1,21,200 + Goods ₹ 4,500 + Prepaid insurance ₹ 1,000; Liabilities = Outstanding salary ₹ 2,000 + Capital ₹ 1,25,200)

What do you mean by dishonour of a bill? What entries will be made in the books of Drawer, if:

1. Bill is with the drawer himself.
2. Bill is discounted with the Bank.
3. Bill is with the endorsee.
4. Bill is sent to the Bank for collection.