CA.CS.CMA.MBA: Naveen.

Rohatgi

JOURNAL

Illustration 1

Journalize the following transactions in the books of M/s. Prathamesh and co. January 2019

1st Started business with cash of Rs. 2,00,000

2nd Bought furniture for Rs. 20,000 in cash

3rdBought goods for Rs. 25,000 in cash

10th Sold .goods for Rs. 30,000 in cash

15th Paid Salary to staff Rs. 5,000 in cash

20th Paid rent Rs. 2,000 in cash

22th Commission received in cash Rs 5,000

25th Bought goods for Rs. 10,000 on credit from Shyam

30th Sold goods for Rs. 10,000 on credit to Sunil.

Illustration 2

On January 1, 2016 Mr. Mahadev started business in the name of M/s. Mahadev &. Sons by bringing in
cash of Rs. 1,00,000 of which Rs. 15,000 deposited in the Canara Bank.

During the month of January 2016 the following transactions took place -

January 3. ..........A loan of Rs. 50,000 taken from the Canara Bank.

January 5............Some materials worth Rs. 10,000 purchased from Mr. Sohanlal on credit
January 7. ..........Furniture worth Rs. 17,500 and machinery worth Rs. 30,000 purchased in cash
 CA.CS.CMA.MBA: Naveen. Rohatgi

January 9………… Rs. 1,000 paid towards telephone charges by cheque.

January 10..........Some office equipments bought for Rs. 4,500 from M/s. Tiger & Sons on credit.
January 12..........Goods worth Rs. 26,500 sold in cash
January 15..........Goods worth Rs. 4,000 sold to Mr. Shiva on credit

January 16..........50 shares of Tata Steel Ltd. @ Rs. 280 per share purchased in cheque
January 18. ........Mr. Shiva returned goods worth Rs. 100 being defective.
January 20..........Rs. 3,750 received from Mr. Shiva after allowing him Rs. 150 as discount.

January 21……….. Goods worth Rs. 5,500 purchased on credit from Mr. Shyam and sold to
Ravi Traders for Rs. 6,200 on credit

January 22…….....Rs. 201 given as donation in cash

January 25. …….Rs. 5,300 paid as salaries to the staff members in cash

January 28………Rs. 2,100 received from a salesman in cash for the goods sold after
deducting his travelling expenses of Rs. 175.

You are required to pass the journal entries in the journal of M/s. Mahadev & &. Sons

Illustration 3

The following transactions took place in the business of M/s. Nanavati & Co. during April 2016. You
are required to journalise them
April 1 ……………Mr. Nanavati started business with Rs. 1,00,000 cash and a machine of Rs
25,000. Out of Rs. 1,00,000 Rs. 50,000 deposited in the State Bank of India.
April 2 …………….. Goods worth Rs. 3,300 purchased from Mr. Chimanlal. Cash paid to
him Rs. 1,000.

April 4 ..................Stationery worth Rs. 250 purchased on cash.

April 5 .................Goods sold to Padma Traders for Rs. 1,500 on credit

April 10...............Goods purchased from Mr. Soneji for Rs. 1,500 on credit
April 11 ..............Half of the goods purchased from Soneji sold to Mr. Kanji on credit on a
profit of Rs. 125 .

April 12................Rs. 2,150 paid to Mr. Chimanlal in full and final settlement of Rs. 2,300.
 CA.CS.CMA.MBA: Naveen. Rohatgi

April 18................Mr. Nanavati brought in additional capital of Rs. 25,000 in cash.

April 20………………Goods worth Rs. 3,000 sold to Mr. Raman on credit at 10% trade
discount

April 22……………….Mr. Kanji is declared insolvent and only 50 paise in a rupee could
be recovered from him.

Illustration 4

Journalise the following transactions in the books of M/s. Rekha Traders 2016

November 1……..Started business with

Cash Rs. 5,00,000/-
Land Rs. 6,00,000/-

Machinery Rs. 1,50,000/-

Bank Rs 20,000/-

November2………. Paid rent to the landlord Rs. 1,450/- by cheque

November4............Sold goods to Dinar for Rs. 6,430/- on credit

November7............Purchased a building from Narendra for Rs. 2,00,000/-. Rs. 50,000 paid
immediately. The balance is payable in three equal annual installments.
November9............Withdrew cash of Rs. 500/- for personal use.

November 11 ........Dinar returned goods worth Rs. 480/-

November 15 ........Purchased furniture on credit from Randhir for Rs. 3,900/.

November20..........Received Rs. 5,900/- from Dinar and allowed him a cash discount of Rs.
50/-

November 22 ........Rs. 3,800/- paid to Randhir in full settlement of Rs. 3,900/-

November25 .......Rs. 500/- received as commission in cash

November 27. .......Rs. 3000/- incurred on advertising in cash

November 28. .......Fire insurance premium of Rs. 1,200/- paid in cheque

November30…….. Goods sold on credit to rohan on Rs 5,000, 10 % Trade discount.

CA.CS.CMA.MBA: Naveen. Rohatgi

HOME WORK SECTION

Illustration 1

Analyse and then journalise the following transactions in the books of Mr. B.
2013
Jan. 1 1. Started business with a capital of Rs. 7,500.
Jan. 1 2. Purchased goods from Mr. Z for Rs. 2,000 on credit
Jan. 1 3. Loan taken from W Rs. 300.
Jan. 1 4. Goods sold to Mr. L for cash Rs. 2,500.
Jan. 5 5. Cash paid to Mr. Z Rs. 2,000.
Jan. 5 6. Purchased Furniture for office Rs. 700.
Jan. 5 7. Paid Office Rent out of personal cash of B Rs. 400.
Solution
JOURNAL OF B
Date No. Particulars LF Dr. Cr.
2013 Amount. Amount
Jan. 1 1. Cash A/c Dr. 7,500
To B’s Capital A/c 7,500
[Being cash brought in by B to start business]
2. Purchase A/c Dr. 2,000
To Z’s A/c 2,000
[Being goods purchased from Z on credit]
3. Cash A/c Dr. 300
To W’s A/c 300
[Being Loan received from W]
4. Cash A/c Dr. 2,500
To Sales A/c 2,500
[Being goods sold to L for cash]
Jan.5 5. Z’s A/c Dr. 2,000
To Cash A/c 2,000
[Being cash paid to Z for previous credit
purchases]
6. Furniture A/c Dr. 700
The Cash A/c 700
[Being furniture purchased for cash]
7. Rent A/c Dr. 400
To capital a/c 400
(Being rent paid out of personal expenditure)
Total Rs. 15,400 15,400

Illustration 2 From the following particulars, prepare the journal of A.

2013 Rs.
Dec 1 Started business with cash 3,000
3 Purchased goods for cash 400
5 Advertisement expenses paid 250
CA.CS.CMA.MBA: Naveen. Rohatgi

7 Sold goods for cash 575

11 Further capital introduced 1,000
14 Paid to B, a creditor 900
17 Received commission from C in cash600
19 Paid to D on account 175
22 Received from E, a debtor 2,000
29 Salary paid in cash 1,000

Solution:
Journal of A
Date No. Particulars LF Debit Credit
Amount. Amount
2012
Jan. 1 1. Cash A/c Dr. 3,000
To Capital A/c 3,000
[For cash introduced as capital]
3 2. Purchase A/c Dr. 400
To Cash A/c 400
[For cash purchases]
5 3. Advertisement A/c Dr. 250
To Cash A/c 250
[For advertisement expenses paid]
7 4. Cash A/c Dr. 575
To Sales A/c 575
[For cash sales]
11 5. Cash A/c Dr. 1,000
To Capital A/c 1,000
[For additional capital]

14 6. B’s A/c Dr. 900

To Cash A/c 900
[For paid against purchases]
17 7. Cash A/c Dr. 600
To Commission A/c 600
[For commission from C]
19 8. D’s A/c Dr. 175
To Cash A/c 175
[For cash paid on account]
22 9. Cash A/c Dr. 2,000
To E’s A/c 2,000
[For receipt from E]
30 10. Salary A/c Dr. 1,000
To Cash A/c 1,000
[For salaries paid]
Total Rs. 9,900 9,900
CA.CS.CMA.MBA: Naveen. Rohatgi

Illustration 3:

Journalise the following transactions:

2013
Jan. 1. B started business with cash worth Rs. 10,000,
2. Purchased goods for Rs. 15,000 in cash
Purchased goods from M for Rs. 3,000 on credit
3. Sold goods to Y for Rs. 4,000 on credit
Sold goods for Rs. 5,000 in cash
4. Y returned goods worth Rs. 1,000.
Returned goods to M worth Rs. 2,000.
5. B took away goods worth Rs. l,000 for personal purpose
Goods worth Rs. 2,000 were destroyed in fire.
Distributed goods worth Rs. 500 as free samples.
Solution:
Journal
Date No. Particulars LF Debit Credit
Amount. Amount
2013
Jan. 1 1. Cash A/c Dr. 10,000
To B’s Capital A/c 10,000
[For goods brought in by B]
2 2. Purchase A/c Dr. 15,000
To Cash A/c 15,000
[For cash purchases; see Note(1)]
2 3. Purchase A/c Dr. 3,000
To M’s A/c 3,000
[For credit purchase from M]
3 4. Y’s A/c Dr. 4,000
To Sales A/c 4,000
[For credit sale to Y]
3 5. Cash A/c Dr. 5,000
To Sales A/c 5,000
[For goods returned by Y]
4 6. Sales return A/c Dr. 1,000
To Y’s A/c 1,000
[For goods returned by Y]
4 7. M’s A/c Dr. 2,000
To Purchase return A/c 2,000
[For goods returned to M]
5 8. Drawings A/c Dr. 1,000
To Goods Taken By B A/c 1,000
[For goods taken by B]
5 9. Loss of Fire A/c Dr. 2,000
To Goods Lost by Fire A/c 2,000
[For goods lost by fire ]
CA.CS.CMA.MBA: Naveen. Rohatgi

5 10. Advertisement A/c Dr. 500

To Goods Given as Samples A/c 500
[For goods given as samples]
Total Rs. 43,500 43,500

Illustration 4:
Give Journal entries for the following transactions:
1. B started business by bringing in cash Rs. 3,000, goods worth Rs. 4,000 and vehicle
worth Rs. 5,000.
2. B purchased goods worth Rs. 8,000 from X and paid him Rs. 2,000.
3. B sold goods worth Rs. 3,000 to A who paid him , immediately.
4. B took goods worth Rs. 1,000 and cash Rs. 2,500 for his own use.
Solution:
Journal of B
Date No. Particulars LF Debit Credit
Amount. Amount
1 1. Cash A/c Dr. 3,000
Purchase A/c Dr. 4,000
Vehicle A/c Dr. 5,000
To B’s Capital A/c 12,000
[For items brought in by B to start business]
2 2. Purchase A/c Dr. 8,000
To Cash A/c 2,000
To X’s A/c 6,000
[For purchases from X partly on cash,
partly on credit]
2 3. Cash A/c Dr. 3,000
To Sales A/c
[For sales to A partly on cash and 3,000
partly on credit]
3 4. B’s Drawings A/c Dr. 3,500
To Goods Taken by BA/c 1,000
To Cash A/c 2,500
[ goods and cash taken by B]
Total Rs. 26,500 26,500

Illustration 5:
Journalise the following transactions in the books of both A and B.
2013
Jan. 1 Goods sold by A to B on Credit Rs. 3,000.
2 Goods returned by B to A Rs. 500.
15 Cash paid by B Rs. 2,500 to A.
20 Loan taken by A from B Rs. 10,000.
21 Furniture purchased by A from B worth Rs. 2,000 on credit
CA.CS.CMA.MBA: Naveen. Rohatgi

Solution:
Journal of A
Date No. Particulars LF Debit Credit
Amount. Amount
Jan. 1 1. B’s A/c Dr. 3,000
To Sales 3,000
[Being goods sold to B on credit]
2 2. Sales Returns A/c Dr. 500
To B’s A/c 500
[Being goods returned by B out of
Jan. 1 transaction]
15 3. Cash A/c Dr. 2,500
To B’s A/c 2,500
[Being cash received from B against
credit sales]
20 4. Cash A/c Dr. 10,000
To B’s Loan A/c 10,000
[Being loan taken from B]
22 5. Furniture A/c Dr. 2,000
To B’s A/c 2,000
[Being furniture purchased from B on credit]
Total Rs. 18,000 18,000

Journal of B
Date No. Particulars LF Debit Credit
Amount. Amount
Jan. 1 1. Purchase A/c Dr. 3,000
To A’s A/c 3,000
[Being goods purchased from A on credit]
2 2. A’s A/cDr. 500
To Purchase Returns A/c 500
[Being goods purchased on Jan. 1,
returned to A]
15 3. A’s A/c Dr. 2,500
To Cash A/c 2,500
[Being cash paid to A against credit
purchases]
20 4. Loan to A A/c Dr. 10,000
To Cash A/c 10,000
[Being loan given to A]
22 5. A’s A/c Dr. 2,000
To Furniture A/c 2,000
[Being furniture sold to A on credit]
Total Rs. 18,000 18,000
CA.CS.CMA.MBA: Naveen. Rohatgi

Illustration 6:

Prepare Arohi’s Journal from the following details for January, 2013:
Jan. 1 Purchased goods of Rs. 50,000 from Suman on credit.
2 Returned goods of Rs. 1,000 to Suman.
5 Purchased goods of Rs. 50,000 from Vimal on credit @ 10% trade discount.
7 Returned goods having list price of Rs. 1,000 to Vimal.
16 Purchased goods of Rs. 1,00,000 from Naren on credit @ 10% trade discount.
26 Returned goods having list price of Rs. 10,000 to Naren.
31 Purchased goods for Rs. 12,000 @ 5% trade discount from Rakesh on credit .
Journal of Arohi

Date No. Particulars LF Debit Credit

Amount. Amount
2013 1. Purchase A/c Dr. 50,000
Jan. 1 To Suman 50,000

2 2. Suman a/c Dr. 1,000

To Purchase Return 1,000

5 3. Purchase A/c Dr. 45,000

To Vimal A/c 45,000

7 4. Vimal a/c Dr. 900

To purchase return 900

16 5. Purchase a/c Dr. 90,000

To Naren 90,000

26 6. Naren A/C Dr. 9,000

To Purchase Return 9,000

31 7. Purchase A/c Dr 11,400

To Rakesh A/C 11,400

Total Rs. 2,07,300 2,07,300

Illustration 7 :
Prepare Sonia’s Journal from the following details for January, 2013:
Jan. 1 Sold goods of Rs. 5,000 to Monica on credit.
2 Monica returned goods of Rs. 1,000.
5 Sold goods of Rs. 5,000 to Radhika @ 10% trade discount on credit.
7 Radhika returned goods having list price of Rs. 1,000.
CA.CS.CMA.MBA: Naveen. Rohatgi

16 Sold goods of Rs. 10,000 to Namita on credit @ 10% trade discount.

26 Namita returned half the goods.
31 Sold goods for Rs. 12,000 @ 5% trade discount to Ruchita on credit.
Journal of Monica

Date No. Particulars LF Debit Credit

Amount. Amount
2005 1. Monica A/c Dr. 5,000
Jan. 1 To Sales 5,000

2 2. SalesReturnA/c Dr. 1,000

To Monica 1,000

5 3. Radhika A/c Dr. 4,500

To Sales A/c 4,5000

7 4. Sales Return a/c Dr. 900

To Radhika A/C 900

16 5. Namita a/c Dr. 9,000

To Sales A/C 9,000

26 6. SalesReturnA/C Dr. 4,500

To Namita 4,500

31 7. Ruchita A/c Dr 11,400

To Sales A/C 11,400

Total Rs. 36,300 36,300

Illustration 8:
Enter the following transactions in Journal of A.
Dec. 1 Cash introduced in business Rs. 10,000.
3 Purchased goods for cash Rs. 2,700.
5 Received Rs. 2,500 from C and allowed discount of I 500.
7 Paid to B Rs. 450 and received a discount of Rs. 50.
11 Paid, wages to workers Rs. 4,300.
16 Paid for office rent Rs. 600
19 Received from B Rs. 1,800 after allowing him a discount of Rs. 200.
23 Received interest Rs. 150.
27 Received Rs. 2,400 from C for the balance due, the amount payable is Rs
3,000
Solution:
Journal of A
CA.CS.CMA.MBA: Naveen. Rohatgi

Date No. Particulars LF Debit Credit

Amount. Amount
2005
Dec. 1 1. Cash A/c Dr. 10,000
To Capital A/c 10,000
[For cash introduced as capital]
3 2. Purchases A/c Dr. 2,700
To Cash A/c 2,700
[For cash purchases)
5 3. Cash A/c Dr. 2,500
Discount Allowed A/c Dr. 500
To C’s A/c 3000
[For cash received and discount allowed]
7 4. B’s A/c Dr. 500
To Cash A/c 450
To Discount Received A/c 50
[For cash paid and discount received]
11 5. Wages A/c Dr. 4,300
To Cash A/c 4,300
[For wages paid)
16 6. Office Rent A/c Dr. 600
To Cash A/c 600
[For office rent paid]
19 7. Cash A/c Dr. 1,800
Discount Allowed A/c Dr. 200
To B’s A/c 2,000
[ cash received and discount allowed)
23 8. Cash A/c Dr. 150
To Interest A/c 150
[For receipt of interest)
27 9. Cash A/c Dr. 2,400
Discount Allowed A/c Dr. 600
To C A/c 3,000
[For cash received and discount allowed]
Total Rs. 26,250 26,250

Illustration 9:
Record the following transactions in the books of D:
2013
Jan.1. Purchased machinery from B for Rs. 50,000. Expenses on transportation
were Rs. 2,000. Installation charges came to Rs. 3,000.
Jan. 2 Purchased an office building for Rs. 75,000.
Feb. 20 Paid Rs. 3,000 for repairs on machinery and Rs. 4,000 on electricity, to run the
machinery. Paid Insurance premium for office building Rs. 7,500.
Oct. 10 Sold office building to M for Rs. 90,000 on credit
Oct. 20 Sold machinery for Rs. 45,000 on cash
CA.CS.CMA.MBA: Naveen. Rohatgi

Solution:
Journal of D
Date No. Particulars LF Debit Credit
Amount. Amount
Jan. 1 1. Machinery A/c Dr. 55,000
To B’s A/c 55,000
[For machinery purchased and expenses on
transportation and installation )

2 3. Office Building A/c Dr. 75,000

To Cash A/c 75,000
[For office building purchased vide agreement
dated ….]
Feb. 20 4. Machinery Repairs A/c Dr. 3,000
Electricity A/c Dr. 4,000
Building Insurance A/c Dr. 7.500
To Cash A/c 14,500
[For various expenses paid]
Oct. 10 5. M’s A/c Dr. 90,000
To Office Building A/c 75,000
To Profit on Sale of office building A/c 15.000
[For sale of office building to M at profit:
90,000 - 75,000]
20 6. Cash A/c Dr. 45,000
Loss on Sale of Machinery A/c Dr. 10,000
To Machinery A/c 55,000
[For sale of machinery at loss:
50,000 + 5,000 - 45,000]
Total Rs. 2,89,500 2,89,500

Illustration 10:
Record the following transactions in the books of C:
2013
Jan. 1 Purchased 100 Shares of BBC Limited having face value of Rs. 10 at Rs. 20
each. Paid brokerage at 1% of purchase price.
Oct. 10 BBC Limited declared and paid dividend at the rate of 15%.
Oct. 20 Sold the shares of BBC Limited at Rs. 25 each.
Solution:
Journal of C
Date No. Particulars LF Debit Credit
Amount. Amount
Jan. 1 1. Investment in Shares A/c Dr. 2,020
To Cash A/c 2,020
[For purchase of 100 shares of BBC Ltd.
at Rs. 20 each: 100  20 and paid the
brokerage of 1%)
CA.CS.CMA.MBA: Naveen. Rohatgi

Oct. 10 3. Cash A/c Dr. 150

To Dividend A/c 150
[Dividend received on shares : at 15% of
Rs. 1,000]
20 4. Cash A/c Dr. 2,500
To Investment in Shares A/c 2,020
To Profit on Sale of Investment A/c 480
[For profit on sale of shares in BBC Ltd.]
Total Rs. 4,670 4,670

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