Recording of Transactions - 1 — Account STD 11 Commerce — Question

Rectify the following errors:

1. Furniture purchased for ₹ 10,000 wrongly debited to purchases account.
2. Machinery purchased on credit from Raman for ₹ 20,000 was recorded through purchases book.
3. Repairs on machinery ₹ 1,400 debited to machinery account.
4. Repairs on overhauling of secondhand machinery purchased ₹ 2,000 was debited to Repairs account.

On 31st March, 2017, Pass Book showed a balance of ₹ 25,000. Prepare a Bank Reconciliation Statement from the following particulars:

1. Cheques of ₹ 20,000 were deposited in Bank on 27th March, 2017, out of which cheques of ₹ 5,000 were cleared on 1st April, 2017. Rest are not cleared.
2. On 28th March, 2017, cheques were issued amounting to ₹ 15,000, out of which cheques of ₹ 3,000 were presented in March, ₹ 4,000 on 2nd April and rest were not presented.
3. Cheques of ₹ 10,000 were deposited in Bank on 28th March, 2017, out of which cheques of ₹ 4,000 were cleared on 2nd April, 2017 and rest are dishonoured.
4. Interest on investment collected by bank does not appear in the Cash Book ₹ 800.
5. A B/R of ₹ 9,000 previously discounted from the bank was dishonoured on 30th March, 2017 but no intimation was received from the bank till 31st March.
6. Bank has debited ₹ 1,500 and credited ₹ 1,200 in our account.

On 31st March, 2023, Bank Statement of Gopal shows credit balance of ₹ 33,570
whereas Cash Book showed debit balance of ₹ 53,000.
It was observed that the differences were because of the following:
i. Cheques and drafts sent to the bank but not collected and credited, amounted to ₹ 7,900 while cheque for ₹ 2,000 was received unpaid.
ii. Three cheques drawn for ₹ 3,000; ₹ 1,500 and ₹ 2,000 respectively were not presented for payment till 30th April, 2023.
iii. Bank has paid a cheque of ₹ 10,000 but it has not been entered in the Cash Book and a cheque of ₹ 5,000 which was discounted with the bank was dishonoured by the drawee on the due date.
iv. Bank has charged ₹ 130 as its commission for collecting outstation cheques and had credited an interest of ₹ 100 in the account.
v. A wrong debit of ₹ 5,000 was made by the bank, which was reversed on 4th April, 2023. Prepare Bank Reconciliation Statement as on 31st March, 2023.

How is a Bank Reconciliation Statement prepared?

Record the following transaction in simple cash book for November 2016:

		₹
01	Cash in hand	12,500
04	Cash paid to Hari	600
07	Purchased goods	800
12	Cash received from Amit	1,960
16	Sold goods for cash	800
20	Paid to Manish	590
25	Paid cartage	100
31	Paid salary	1,000

Explain any two reasons on account of which the balance as shown by the Pass Book does not agree with the balance as shown by the bank column of the Cash Book.

On 1st January, 2019, A sold goods to B for ₹ 5,000 plus IGST @ 18%. A received ₹ 900 by cheque from B and drew on him a bill for the balance amount payable 3 months after date. The bill was duly accepted by B. A retained the bill till due date. On due date, the bill was paid.
Pass Journal entries in the books of A and B. Also, show necessary accounts in the books of both the parties.

Rectify the following errors:

1. Bought Radio for ₹ 1,000 for the proprietor was debited to General Expenses A/c.
2. Bought goods from Mohan ₹ 2,000 was passed through the Sales Book, however, the account of Mohan was credited correctly.
3. Wages due ₹ 1,500 has not been taken into account.
4. Goods Returned by Kamal ₹ 240 has been debited to his account ₹ 420.

What is the difference between Book Keeping and Accounting?

What is a Source Document?