Model Journal entries

1. Started a business with cash, debtors, creditor, loan, furniture, goods

Cash account Dr.
Debtor account Dr.
Furniture account Dr.
Goods account Dr.
To creditor account
To loan’s account
To capital account
2. Paid for fees of son, saree for wife and for personal use .

Drawing account Dr.

To, cash account
3. Purchase goods returned
If credit
Supplier’s account Dr.
To purchase return account
If cash
Cash account Dr.
To purchase return account

4. Sales return
If credit
Sales return account Dr.
To customer’s 'A'

If cash
Sales return account Dr.
To cash account

5. Goods purchase from 'A' for Rs. 100 and sell it to 'B' at a profit of 10%
Purchase account Dr. (Rs. 100)
To ‘A’s account

‘B’s account Dr. (Rs. 110)

To sales account

6. Goods damaged by fire

Loss by fire account Dr.
To goods burnt by fire account

7. Goods damaged by fire and which is insured

Goods worth of Rs. 2000 damaged by fire. For which sum of Rs. 1500 is received from
insurance company, Rs. 200 received from sale of the scrap.
Insurance co’s account Dr. 1500
Cash account Dr. 200
Loss by fire account Dr. 300
To goods burnt by fire account 2000
8. Goods stolen away
Loss by theft account Dr.
To goods stolen account

9. Goods destroyed by rain

Loss due to rain account Dr.
To goods destroyed by rain account

10. Goods given for charity

Charity account Dr.
To goods given as charity account

11. Goods distributed as advertise

Advertisement exp. Account Dr.
To goods given as sample account

12. Goods received as a free sample

Non financial / economical transaction

13. Goods received as a free sample are sold

Cash account Dr.
To Goods received as a free sample account
(at the price of sales)

14. Due amount settled with discount/ paid at a discount

Creditor’ account (person who is reciever) Dr.
To discount received/allowance account
To cash account

15. Due amount received with discount

Cash account Dr.
Discount allowed/allowance account Dr.
To debtor’s account (person who is payer/giver)

16. Purchase a machine and also paid for installing charges

Machinery account Dr.
To cash account
Or
Machinery account Dr.
Installation charges account Dr.
To cash

17. Purchase asset in exchange

Eg: purchase a computer for Rs. 20000 in exchange of goods of Rs. 10000
Computer account Dr. 20000
To sales 20000
( Purchase a computer of Rs. 20000 and given goods for Rs. 10000 in exchange)
18. Borrowed a loan
Cash account Dr.
To xxx loan account (giver’s name)
19. Issued/granted a loan
Xxx loan’s account Dr.
To cash account
20. Paid the interest of a loan
Interest on xxx loan account Dr.
To cash account
21 .Amount debited as a charges by bank
Bank charges account Dr.
To bank account
22. Amount credited by bank on behalf of us
Bank account Dr.
To interest/dividend account
23. Sold goods and paid the expences on behalf of purchaser
Debtor’s account Dr.
To sales account (sales price)
To cash account ( exp.made)
24. An amount reciavable is to be written off
Bad debts account Dr.
To debtor’s account
25. A debtor became insolvent and some money only recieved from him
Bad debts account (Amt. Not recieved) Dr.
Cash account (Amt. Recieved) Dr.
To debtor’s account
26. Bad debt written off recovered
Cash account Dr.
To bad debt reciverd account
27. Purchase a goods on cash discount and trade discount and half payment is made
by cash+bank and rest is due
Purchase account Dr.
To bank account
To cash account
To cash discount account
To debtor’s/purchaser account (due amount)
28. Sale of goods on cash discount and trade discount and half amount is recieved by
cash+bank and rerst is due
Bank account Dr.
Cash account Dr.
Cash discount account Dr.
Creditor’s account Dr.
To sales account
29. Purrchase of balance and weights
Dead stock account Dr.
To cash
( on purchasing of any asset it will dr. With its name only i.e. building a/c,furniture a/c etc.)