general journal

Workbook

[email protected] General Journal (Solved)

26

Unit 3

GJ # 3.1 On April 01, 2008 Anees stared business with Rs. 100,000 and other transactions for the month as follows.

2. Purchase Furniture for Cash Rs. 7,000.

8. Purchase Goods for Cash Rs. 2,000 and for Credit Rs. 1,000 from Khalid Retail Store.

14. Sold Goods to Khan Brothers Rs. 12,000 and Cash Sales Rs. 5,000.

18. Owner withdrew of worth Rs. 2,000 for personal use.

22. Paid Khalid Retail Store Rs. 500.

26. Received Rs. 10,000 from Khan Brothers.

30. Paid Salaries Expense Rs. 2,000 and Rent Expense Rs. 3,000.

General Journal

Date Account Title and Explanations Ref

Amount (Rs)

Debit Credit

2008

April 1 Cash 100,000 Owner’s Equity_ Anees 100,000 (Started business with cash) 2 Furniture 7,000

Cash 7,000

(Purchase furniture for cash)

8 Purchases 3,000 Cash 2,000 Account Payable_ Khalid Retail Store 1,000 (Purchase good on cash and credit) 14 Cash 5,000 Account Receivables_ Khan Brothers 12,000 Sales 17,000

(Cash and Credit Sales recorded)

18 Drawing 2,000

Cash 2,000

(Owner withdrew for personal use)

22 Account Payable_ Khalid Retail Store 500

Cash 500

(Paid credit to Khalid Retail Store)

26 Cash 10,000 Account Receivable_ Khan Brothers 10,000 (Receive cash from credit customer)

30 Salaries Expense 2,000 Rent Expense 3,000 Cash 5,000 (Paid expenses)

Total Rs. 144,500 Rs. 144,500

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27

Unit 3

GJ # 3.2 Mr. Naveed Khan is sole owner of business. He has been started business since 1990 in Karachi. Following

are transaction of Naveed’s business for the month of August 2007.

3. Reinvestment in the shape of Cash Rs. 80,000 and Furniture Rs. 20,000.

5. Cash Sales Rs. 10,000 and on account Sales Rs. 12,000.

6. Bought goods from Ahmed Co. Rs. 60,000 paid Rs. 15,000 cash and remaining Note payable pay with in 30 days.

9. Purchase Office Equipment from Ali Malik & Sons worth Rupees Rs. 99,000, a cash down payment of Rs. 19,000 and

balance will be paid by four instalments, first due on 30 August.

21. Goods return by credit customer of worth Rs. 12,000.

30. Paid first instalment of Rs. 20,000.

General Journal


Amount (Rs.)

Debit Credit

2007

Aug. 3 Cash 80,000

Furniture 20,000

Owner’s Equity_ Naveed Khan 100,000

(Reinvest by owner in the business)

5 Cash 10,000

Account Receivable 12,000

Sales 22,000

(Cash and Credit Sales)

6 Purchases 60,000

Cash 15,000

Note Payable_ Ahmed Co. 45,000

(Purchases by cash and credit from Ahmed)

9 Office Equipment 99,000

Cash 19,000

Account Payable_ Malik & Sons 80,000

(Purchase O. equipment on instalments by A. Malik)

21 Sales Return 12,000


(Goods return by credit customer)

30 Account Payable_ Malik & Sons 20,000

Cash 20,000

(Paid 1st instalment to Ali Malik & Sons)

Total Rs. 313,000 Rs. 313,000

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28

Unit 3

GJ # 3.3 On March 2009, a merchandise trader ABC, starts wholesaling business. Following transactions as follows

1. A merchant started business with capital of Rs. 15,000 and Land worth Rs. 10,000.

8. Bought goods from Bilal and Friends Rs. 1,000 and by cash from XYZ Co. Rs 2,000.

13. Sold goods to Rehman & sons Rs. 1,500 and sale by cash Rs. 5,000.

17. Gave away charity of cash Rs. 50 and merchandising worth Rs. 30.

21. Paid Bilal and Friends cash Rs. 975; discount received Rs. 25.

28. Received cash from Rehman & Sons Rs. 1,450; allowed him discount of Rs. 50.

General Journal

Date Account Title and Explanations Ref Amount (Rs.)

Debit Credit

2009 March 1 Cash 15,000

Land 10,000

Owner’s Equity_ ABC 25,000

(Owner started business by assets) 8 Purchases 3,000

Account Payable_ Bilal and Friends 1,000

Cash 2,000

(Purchases by cash and by credit) 13 Account Receivable_ Rehman & sons 1,500

Cash 5,000

Sales 6,500

(Purchases by cash and Credit from Ahmed) 17 Charity 80

Cash 50

Purchases 30

(Charity by cash and by goods) 21 Account Payable_ Bilal and Friends 1,000

Cash 975

Discount 25

(Discount received and liability payoff) 28 Cash 1,450

Discount 50

Account Receivable_ Rehman & sons 1,500

(Account receivable realized and discount allowed)

Total Rs. 37,080 Rs. 37,080

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29

Unit 3

GJ # 3.4 Goodwood Marine is a boat repair yard. During August 2009, its transactions included the following

03. Loan taken from Habib Bank Ltd. of Rs. 25,000. Rs. 20,000 withdrawn for business and remaining in the bank account.

06. Paid rent for the month of August Rs. 4,400 and accrued rent expenses was Rs. 600.

12. At request of Kiwi Insurance, Inc, made repairs on boat of Jon Seaways. Sent bill for Rs. 5,620 for services rendered to

Kiwi Insurance Inc. (credit Repair Service Revenue).

18. Made repairs to boat of Dennis Copper and collected in full the charge of Rs. 2,830.

20. Placed Advertisement in The Dawn to be published in August 23 at a cost of 165, payment to be made within 30 days.

25. Received a check for 5,620 from Kiwi Insurance Inc representing collection of the receivable of August 12.

30. Sent check to The Dawn in payment of the liability incurred on August 20.

General Journal


Debit Credit

2009

Aug. 3 Cash 20,000 Bank 5,000

Bank Loan 25,000 (Bank loan liability has been taken)

6 Rent Expenses 5,000 Cash 4,400 Rent Payable 600 (Rent Expenses paid and outstanding)

12 Account Receivable_ Kiwi Insurance Inc. 5,620 Repair Service Revenue 5,620 (Sent bill to customer)

18 Cash 2,830 Repair Service Revenue 2,830 (Repair services received by cash)

20 Advertisement Expenses 165 Advertisement Payable_ The Dawn 165

(Advertisement Expenses incurred but not paid) 25 Bank 5,620

Account Receivable_ Kiwi Insurance Inc. 5,620

(Receivable collected by bank)

30 Advertisement Payable_ The Dawn 165 Bank 165

(Paid liability by bank)

Total Rs. 44,400 Rs. 44,400

Workbook


30

Unit 3

GJ # 3.5 1st January, 2010, a trader started business other transactions for the month of June as follows

02. Purchased from Kareem goods of list price of Rs. 6,000 subject to 10% trade discount by cash.

04. Sold goods to Din Muhammad Rs. 800 and cash sales of Rs. 200.

10. Distributed goods worth Rs. 200 as free samples and goods taken away by the proprietor for personal use Rs. 100.

12. Received discount Rs 20 and Commission Rs 500.

17. Goods returned by Din Muhammad Rs. 200 and payment other outstanding amount.

24. Furniture lost by fire of worth Rs. 500.

30. Bad Debts during the period was Rs.100.

General Journal


Debit Credit

2010

Jun 2 Purchases 5,400 Cash 5,400

(Cash purchases and trade discount)

4 Account Receivable_ Din Muhammad 800 Cash 200 Sales 1,000 (Cash and credit sales)

10 Free Sample 200

Drawing 100

Purchases 300 (Free sample and drawing through purchases)

12 Cash 520 Discount 20

Commission 500 (Other income in terms of discount and commission)

17 Return Inward 200 Cash 600

Account Receivable_ Din Muhammad 800

(Sales return and received other amount by customer)

24 Lost by Fire 500 Furniture 500 (Furniture lost by fire)

30 Bad Debts 100 Account Receivable 100

(Bad Debts are recorded)

Total Rs. 8,620 Rs. 8,620

Workbook


31

Unit 3

GJ # 3.6 Rahim and company started business with capital of Rs. 40,000 and Inventory of worth Rs. 5,000.

2009 October 03 Purchased Inventory from Ali Ltd. of worth Rs. 2,000 on account; terms being 2/10- n/30

“ 08 Sold inventory at price equal to Rs. 4,000 costing Rs. 2,500 by cash transaction

“ 16 Defective material returns to Ali Ltd. of worth Rs. 300

“ 18 Purchased Inventory from Ahmed Ltd. of worth Rs. 1,000 on account; terms being 2/15- n/30

“ 23 Paid Rs. 1,500 for 3rd January credit transaction and full amount to Ahmed Ltd.

“ 28 Inventory sold to Jamil for Rs. 3,500 costing Rs. 2,800

General Journal


Debit Credit

2009

Oct 1 Cash 40,00 Inventory 5,000 Owner’s Equity 45,000

(Started business with cash and inventory) 3 Inventory 2,000

Account Payable_ Ali Ltd. 2,000

(Credit Purchase of inventory with credit terms) 8 Cash 4,000 Inventory 2,500 Profit and Loss 1,500 (Sales of inventory and profit recognition) 16 Account Payable_ Ali Ltd. 300

Inventory 300 (Defective inventory return to vendor)

18 Inventory 1,000 Account Payable_ Ahmed Ltd. 1,000

(Credit Purchase of inventory with credit terms)

23 Account Payable_ Ali Ltd. 1,500

Account Payable_ Ahmed Ltd. 1,000 Discount 20 Cash 2,480 (Payment of liabilities and earn discount)

28 Account Receivable_ Jamil 3,500 Inventory 2,800 Profit and Loss 7,00

(Credit sales of inventory and recording of profit )

Total Rs. 58,300 Rs. 58,300

Workbook


32

Unit 3

GJ # 3.7 Record the following transaction in General Journal as July, 2009

01. Starts a business by opening a bank account with Rs. 50,000 and petty cash of worth Rs. 10,000.

06. Buys stationary from Ink stores valued at Rs. 700. It expects to pay for the stationary in a month’s time.

09. Goods purchase of worth Rs. 10,000 by cash and trade discount received 10%.

11. Unearned sales of Rs. 3,200 earned during the July.

17. Made sales of worth totalling Rs. 1,800. Collected 400 by bank balance due with in 30 days in terms of Note.

24. Paid Salaries Expenses of Rs. 1,200; Rent Expenses of Rs. 1,400 and Carriage Expense are outstanding Rs. 2,400.

29. Sold Goods to Ahmed Ali on cash Rs. 4,000 with 10% trade discount.

General Journal


Debit Credit

2009

July 1 Bank 50,000 Cash 10,000

Owner’s Equity 60,000

(Started business with bank and cash) 6 Stationery 700

Account Payable_ Ink stores 700

(Credit Purchase of stationery) 9 Purchases 9,000 Cash 9,000 (Purchases with trade discount on cash) 11 Unearned Sales 3,200

Sales 3,200

(Unearned sales now earned) 17 Note Receivable 1,400

Bank 400 Sales 1,800 (Cash and credit sales)

24 Salaries Expenses 1,200 Rent Expenses 1,400 Carriage Expenses 2,400

Cash 2,600

Carriage Payable 2,400 (Expenses paid and incurred liability)

29 Cash 3,600 Sales 3,600

(Cash sales subject to trade discount )

Total Rs. 83,300 Rs. 83,300

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33

Unit 3

GJ # 3.8 During April 2009, following transactions were completed by business.

4. Cash received customer billed earlier Rs. 14,000.

5. Paid advance rent for six months of Rs. 6,000.

7. Received advance payment from customers Rs. 1,200, services will be provided in August.

11. Services revenue of worth Rs. 3,200 now earned which had received in advance

14. Rs. 1,000 cash was loan to ABC Co. evidenced by note receivable.

17. Billed customer for services provided Rs. 3,000.

24. Rs. 10,000 borrowed from local bank and signed a note payable.

27. Owner draws out Rs. 100 from the business bank account for his own use.

General Journal


Debit Credit

2009

July 4 Cash 14,000 Account Receivable 14,000

(Cash received from customers)

5 Prepaid Rent 6,000 Cash 6,000

(Advance rent paid)

7 Cash 1,200 Unearned Services Revenue 1,200 (Payment received in advance by clients)

11 Unearned Services Revenue 3,200 Services Revenue 3,200

(Unearned services revenue now earned)

14 Note Receivable_ ABC Co. 1,000 Cash 1,000 (Loan granted to ABC company by note)

17 Account Receivable 3,000

Services Revenue 3,000 (Billed to customer)

24 Cash 1,000

Note Payable 1,000

(Obtained loan from bank by note payable)

27 Drawing 100 Bank 100

(Owner personal withdrawal by bank )

Total Rs. 29,500 Rs. 29,500

Workbook


34

Unit 3

GJ # 3.9 Pass the following transaction in the book of original entry for XYZ business for year 2010.

Jan 1 Customer check Rs. 7,000 was dishonoured and return unpaid by the company bank and credit sales Rs. 5,000.

9 Charged interest on capital Rs. 1,000 and reinvestment of capital by owner of worth Rs. 3,000.

11 Goods return by credit customer of Rs. 4,000 and cash customer of worth Rs. 2,000.

17 Write off Depreciation of Machinery was Rs. 5,000 by using cost method and Rs. 4,000 by using (WDM).

24 Goods costing Rs. 500 was taken away by the proprietor and goods donated to charities Rs. 1,000.

29 Interest accrued on bill payable during the month was Rs. 1,000 and interest expense paid Rs. 1,500.

General Journal


Amount (Rs.)

Debit Credit

2010

Jan 1

Account Receivable (7,000 + 5,000) 12,000

Bank 7,000

Sales (Check dishonoured and credit sales recorded)

5,000

9 Interest on Capital 1,000

Cash 3,000 Owner’s Equity 4,000

(Interest on capital and introduced capital)

11 Return Inward (4,000 + 2,000) 6,000


Cash 2,000

(Sales return by credit and cash customers)

17 Depreciation Expense_ Machinery (5,000 + 4,000) 9,000

Accumulated Depreciation_ Machinery 5,000

Machinery 4,000

(Depreciation recording by cost and WDM)

24 Drawing 500

Charity 1,000

Purchases (500 + 1,000) 1,500

(Goods withdrawn and give as charity)

29 Interest Expenses (1,000 + 1,500) 2,500

Interest Payable 1,000

Cash 1,500

(Interest Liability and portion paid)

Total Rs. 35,000 Rs. 35,000

Workbook


35

Unit 3

GJ # 3.10 Record the following economic events in the book of prime entry for Star business for year 2010.

Feb 2. Merchandise return to supplier Rs. 5,000 so reduces liability and return to cash vendor of Rs. 3,000.

5. Replenished inventory for Rs. 6,000 cash and paid Insurance expenses Rs. 500.

12. Interest on drawing charged Rs. 8,000.

16. Receive cash from Mr. Farooq Rs. 6,000 and sold merchandise to Mr. Zamir by cash Rs. 3,000.

23. Received dividend on securities by bank of Rs. 1,500 and sold marketable securities of Rs, 8,000 by cash.

27. Sales goods for Rs. 30,000 (cost 20,000).

General Journal


Amount (Rs.)

Debit Credit

2010

Jan 2

Account Payable 5,000

Cash 3,000

Purchase Return (Goods return to credit and cash customers)

8,000

5 Inventory 6,000

Insurance Expense 500 Cash 6,500

(Bought inventory and paid expenses)

12 Owner Equity 8,000

Interest on Drawing 8,000

(Interest on drawing is recorded)

16 Cash (6,000 + 3,000) 9,000

Account Receivable_ Farooq 6,000

Sales 3,000

(Receivable realized and cash sales) 23 Bank 1,500

Cash 8,000

Dividend 1,500

Marketable Securities 8,000

(Dividend received and securities sold)

27 Cash 30,000

Inventory 20,000

Profit and Loss 10,000

(Sold inventory and earned profit)

Total Rs. 71,000 Rs. 71,000

Workbook


36

Unit 3

GJ # 3.11 On 1st April, 2010 a Company started business with Inventory valued at Rs. 85,000, placed Cash Rs. 65,000

in a business Bank Account and Marketable Securities of worth Rs. 10,000.

“ 03 Purchase Inventory of Rs. 5,000 paid cash Rs. 1,000 by check and promising the rest on a Note Payable.

“ 14 Sale of marketable securities that cost Rs. 5,000 for Rs. 6,500

“ 25 Note Payable paid Rs. 2,000 and interest expense Rs. 2,500 both expenses by bank.

“ 29 Old machinery sales of worth Rs. 17,000 whose book value was Rs. 20,000

General Journal


Amount (Rs.)

Debit Credit

2010

April 1 Inventory 85,000

Bank 65,000

Marketable Security 10,000

Owner’s Equity 160,000

(Reinvest by owner in the business)

3 Inventory 5,000

Cash 1,000

Note Payable 4,000

(Purchases of inventory)

14 Cash 6,500

Marketable Security 5,000

Capital Gain 1,500

(Sale of marketable securities and earn gain)

25 Note Payable 2,000

Interest Expense 2,500

Bank 4,500

(Payments by bank)

29 Cash 17,000

Capital Loss 3,000

Machinery 20,000

(Old machinery sales and sustain loss)

Total Rs. 189,500 Rs. 189,500

general journal

Documents

cash sales rs

credit rs

shape of cash rs

paid rs

furniture rs

account sales rs

instalment of rs

friends rs