Question

Prepare Journal from the transactions given below:

(a)	Cash paid for installation of machine	₹ 500
(b)	Goods given as charity	₹ 2,000
(c)	Interest charge on capital @7% p.a. when total capital were	₹ 70,000
(d)	Received ₹ 1,200 of a bad debts written-off last year
(e)	Goods destroyed by fire	₹ 2,000
(f)	Rent outstanding	₹ 1,000
(g)	Interest on drawings	₹ 900
(h)	Sudhir Kumar who owed me ₹ 3,000 has failed to pay the amount. He pays me a compensation of 45 paise in a rupee.
(i)	Commission received in advance	₹ 7,000

Answer 1

Journal
S.No	Particulars	L.F.	Debit Amount Rs	Credit Amount Rs
(a)	Machinery A/c   .......Dr.		500
	To Cash A/c			500
	(Cash paid for installation of machinery)
(b)	Charity A/c   .......Dr.		2,000
	To Purchase A/c			2,000
	(Goods given as charity)
(c)	Interest on Capital A/c  .......Dr.		4,900
	To Capital A/c			4,900
	(Interest on capital charged @ 7% p.a)
(d)	Cash A/c  .......Dr.		1,200
	To Bad Debt Recovered A/c			1,200
	(Cash received on from debtors which was previously written off as bad)
(e)	Goods Destroyed by Fire A/c  .......Dr.		2,000
	To Purchases A/c			2,000
	(Goods destroyed by fire)
(f)	Rent A/c    .......Dr.		1,000
	To Rent Oustanding A/c			1,000
	(Rent due but not paid)
(g)	Drawing A/c   .......Dr.		900
	To Interest on Drawing A/c			900
	(Interest allowed on drawing)
(h)	Cash A/c    .......Dr.		1,350
	Bad Debt A/c    .......Dr.		1,650
	To Sudhir Kumar			3,000
	(Sudhir Kumar declared insolvent and cash received from him 45 paise in a rupee in full settlement)
(i)	Commission A/c  .......Dr.		7,000
	To Commission Received in Advance A/c			7,000
	(Commission received in advice)
	OR
	Cash A/c  .......Dr.		7,000
	To Commission Received in Advice			7,000
	(Commission reived in Advice)
	Total		22,500	22,500