From The Desk of: Dr.

Imran Omer
GENERAL JOURNAL ENTRIES
Practice Exercise
Question 1: General Journal:
On February 1, 1991 Aslam started a business with a cash investment of Rs. 100,000.He completed the
following transactions during the month:
February 3: Purchased merchandise on credit from Esajee Rs.25,000.
February 5: Purchased sales equipment on account from Babar and Co. Rs. 15,000.
February 15: Sold merchandise for cash Rs. 12,000 and on credit Rs. 10,000.
February 20: Paid to Esajee Rs. 15,000.
February 25: Collection from customer Rs. 10,000.
February 28: Paid office salaries Rs. 3,000.

Question 2: General Journal:

2012
Sept.1, Mr. Asif started business with the investment of Rs. 250,000 in the bank account.
2, Bought office furniture by cheque Rs. 150,000.
2, Purchased merchandise Rs. 10,000 and paid through cheque.
3, Bought machinery Rs. 7,500 on credit from Planers Ltd.
5, Bought a car paying by cheque Rs.60,000.
7, Purchase merchandise on credit Rs. 7,000.
8, Sold old office furniture for Rs.36,000.
9, Sold merchandise on credit Rs. 5,000.
15, Paid the amount owing to Planers Ltd Rs. 7,500.
20, Sold merchandise on cash 3,000.
23, Paid electric bill Rs. 2,000.
28, Paid salaries for the month of Sept to employees Rs. 10,000.
29, Paid advance rent Rs.1,000.

Required:
1. Prepare Journal entries in Journal General with proper formatting.
2. Prepare General Ledger (T-accounts).
3. Prepare Unadjusted Trial Balance.

Question 3:
1999
May.1, Mr. Rehan started business with Rs. 100,000 cash and 900,000 in the bank account.
4, Purchase office building by cheque Rs. 300,000.
5, Purchased merchandise Rs.100,000.
13, Bought office supplies Rs. 7,500.
15, Purchase office vehicle by paying cheque Rs.180,000.
17, Purchase merchandise on credit Rs. 70,000 from Kashif and Sons Pvt Ltd.
21, Sold merchandise for Rs.60,000 on credit to Najamullah Brothers.
21, Return merchandise worth Rs. 5,000 purchased from Kashif and Sons Pvt. Ltd.
22, Paid to Kashif and Sons Pvt. Ltd. Rs. 7,500.
23, Sold merchandise on cash 33,000.
23, Paid electric bill Rs. 2,000.
26, Najamullah Brothers returned merchandise Rs. 12,000.
30, Received cash from Najamullah brothers Rs. 48,000.

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Required:
1. Prepare Journal entries in Journal General with proper formatting.
2. Prepare General Ledger (T-accounts).
3. Prepare Unadjusted Trial Balance.

Question 4: General journal

Given M/S Khalid Traders started business on March 1, 2006 with a cash investment of
Rs.7,00,000.They completed the following transactions during the month.
March 2. Paid shop rent in advance for one year Rs. 1,20,000.
March 4. Purchased furniture for shop on cash Rs. 50,000.
March 5. Opened a bank account with Rs. 2,00,000.
March 7. Purchased a computer for the business worth Rs. 50,000.
March 10. Purchased merchandise for cash Rs. 1,50,000.
March 15. Sold merchandise for cash Rs. 1,50,000.
March 18. Purchased merchandise on credit for Rs. 80,000.
March 20. Sold merchandise on credit for Rs. 80,000.
March 23. Proprietor withdrew cash and merchandise for Rs. 10,000 and Rs. 5,000 respectively.
March 27. Paid for advertising Rs. 25,000.
March 31. Paid salary to salesman Rs. 15,000 by cheque.

Required:
 Record the above transaction in General Journal of M/S Khalid Traders.
 Post the entries from the General Journal into the General Ledger using T-Accounts.
 Balance the accounts and prepare pre-closing Trial balance in proper form with complete
title and column headings.

Question 5: General journal

During the month of March of the current year Mr. Zia a business consultant completed the following
transactions:
March 1. Zia started his business with the cash investment of Rs. 25,000.
March 2. Bought Rs. 6,000 supplies for his office on credit.
March 3. Paid Rs. 6,000 supplies for his office.
March 5. Purchased office equipment for Rs. 12000.this amount was to be paid in three equal
installments at the end of March, April, and May.
March 16. Receipt from consultation service was Rs. 8,250.
March 30. Payment of salary to the assistant was Rs. 3,600.
March 31. Paid the first installment on equipment.
March 31. Receipt from the service rendered during the last two week ended march 1, amounted to
Rs. 9,300.
March 31. Zia withdrew Rs 8,000 cash for his personal use

Required:
 Record the above transaction in General Journal of M/S Khalid Traders.
 Post the entries from the General Journal into the General Ledger using T-Accounts.

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 Balance the accounts and prepare pre-closing Trial balance in proper form with complete
title and column headings.
Question 6: The proprietor started business in Jan 2013 & invested into the business cash Rs.
100,000
3. Purchase merchandise for Rs. 5,300 and issued a cheque for the amount.
6. Cash sales deposited into bank Rs. 6,000
8. Purchased office supplies for cash Rs. 200
10. Received a cheque for Rs. 4,900 form Mubarak in full settlement of his account of his
account of Rs. 5,000 and deposited the cheque into bank.
15. Sold merchandise for cash Rs. 2,500.
18. Withdraw cash for personal use Rs. 2,000
20. Issued cheque for Rs. 2,450 to Ahmed in full settlement of his account of Rs. 2,500.
24. Withdraw from bank Rs. 5,000 for office use.
27. Merchandise purchased for cash Rs. 3,000.
30. Salary paid by cheque Rs. 3,500.

Instructions:
a) Enter in the General Journal to record the above transaction
b) T-account in the ledger, complete with all postings.
c) Trial Balance after all the postings have been done.

Question 7: Record the journal entries in the books of Mr. ABC for the month of May 2001.
2001
May, 1 Started business with Rs. 2,000 in the bank
2 Purchased merchandise Rs. 175 on credit from M Mills
3 Bought fixtures and fittings Rs. 150 paying by cheque
5 Sold merchandise for cash Rs. 275
6 Bought goods on credit Rs.114 from Kamran Sons
10 Paid rent by cash Rs. 15
12 Bought stationery Rs. 27, paying in cash
18 Goods returned to M Mills
21 Let off part of premises receiving rent by cheque Rs. 5
23 Sold goods on credit to Mr. Usman for Rs. 77
24 Bought a motor van paying by cheque Rs. 300
30 Paid the month’s salary by cash Rs. 117
31 The proprietor took cash for himself Rs. 44

Question 8: Record the journal entries in the books of Mr. Mehboob:

2012
July, 1 Started business with Rs. 8,000 in the bank
2 Bought stationery by cheque Rs. 30
3 Bought merchandise on credit from Mr. Raza Rs. 900
4 Sold merchandise on cash Rs. 180
5 Paid insurance by cash Rs.40
7 Bought machinery on credit from Mr. Rizwan Rs. 500
8 Paid for machinery installation expenses by cheque Rs. 50
10 Sold merchandise on credit to Mr. Raja Rs. 320

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11 Returned merchandise to Mr. Raza Rs. 70
14 Paid salaries by cash Rs. 70
17 Paid rent by cheque Rs. 100
20 Received cheque Rs. 200 from Mr. Raja
21 Paid Mr. Rizwan by cheque Rs. 500
23 Bought stationery on credit from Express Ltd Rs. 80
25 Sold merchandise on credit to Mr. Raja Rs. 230
31 Paid Express Ltd by cheque Rs. 80

Question 9: The following transactions were completed by Mr. Nasir a sole trader during the
month of January 1998
1) Nasir the proprietor invested into the business cash Rs. 100,000 and furniture valued at
Rs. 16,000
2) Purchased merchandise for cash Rs. 6,000
3) Purchased merchandise on credit form Khalid Rs. 2000
4) Sold merchandise for cash Rs. 8,000
5) Sold merchandise on credit to Rashid Rs. 4,000
6) Returned merchandise to Khalid Rs. 300
7) Merchandise returned by Rashid Rs. 200
8) Paid shop rent Rs. 150 in cash
9) Opened current account with the bank with Rs. 10,000
10) Withdraw from the bank Rs. 4,000 for private expense of the proprietor

Instructions:
a) Enter in the General Journal to record the above transaction
b) T-account in the ledger, complete with all postings.
c) Unadjusted Trial Balance after all the postings has been done.

Question 10: Record the journal entries in the books of Wright Enterprises:
2013
Jan, 1 Started business with Rs. 3,000 in the bank and Rs. 500 cash
2 Bought goods on credit: Mr. Shoaib Rs. 250, Mr. Basit Rs. 190 and Mr. Ayub Rs. 180
3 Bought goods for cash Rs. 230
4 Paid rent in cash Rs. 10
5 Bought stationery paying by cheque Rs. 49
6 Sold goods on credit: Mr. Tabish Rs. 140, Mr. Tariq Rs. 100 and Mr. Tanveer Rs. 240
7 Paid salaries in cash Rs. 80
10 Returned goods to Mr. Basit Rs.60
11 Paid rent in cash Rs. 10
13 Mr. Tariq returns goods Rs. 20
15 Sold goods on credit: Mr. Rizwan Rs. 90, Mr. Ayub Rs. 130 and Mr. Basit Rs. 170
16 Paid utilities by cheque Rs. 130
18 Paid insurance in cash Rs. 40
20 Bought motor van on credit from New Motor Company Rs. 600
21 Paid motor expenses in cash Rs. 6
23 Received part of amount owing from Mr. Tanveer by cheque Rs. 200
28 Paid by cheque: Mr. Shoain Rs. 250, Mr. Basit Rs. 130 and New Motor Company Rs. 600

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Question 11: On June 1, 2002 Hammad started his business independently with investment of Rs.
22,222 as his capital. He completed the following transactions during the month.
June 2002
2. Purchased office supplies Rs. 333 cash
3. Purchased Merchandise Rs. 6,666 on account from Amir Bros. and paid in cash
transportation charges on purchases Rs. 111.
5. Purchased sales counter for cash Rs. 999.
8. Sold merchandise on account to Shakir sons Rs. 4,444
15. Cash sales for the day Rs. 1,111
23. Withdraw merchandise worth Rs. 100 and cash Rs. 600 for personal use.
28. Paid for office salaries expense cash Rs. 333.
30. Paid for rent expense cash Rs. 222.

Required:
1. Prepare the general journal entries and set up T-accounts in the ledger of Hammad.
2. Foot the accounts in pencil and enter the balance in the appropriate columns.
3. Test the accuracy of your posting by taking out a Pre-closing Trail Balance on June 30, 2002.

Question 12: Record the journal entries in the books of Nadeem Brothers:
2011
Mar, 1 Started business with cash Rs. 1,500
2 Purchased merchandise on credit from Mr. Jamal Rs. 296
3 Paid rent by cash Rs. 28
4 Paid Rs. 1,000 of the cash of the firm into a bank account
5 Sold merchandise on credit to Nargis & Co Rs. 54
7 Bought stationery Rs. 15 paying by cheque
11 Cash sales Rs. 49
14 Goods returned by us to Mr. Jamal Rs. 17
17 Sold goods on credit to Shafi Enterprises Rs. 29
20 Paid for repairs to the building by cash Rs. 18
22 Nargis & Co. returned goods to us Rs. 14
27 Paid Mr. Jamal by cheque Rs. 279
28 Cash purchases Rs.125
29 Bought a motor van paying by cheque Rs. 395
30 Paid motor expenses in cash Rs. 15
31 Bought fixtures Rs.120 on credit from Bee Furniture

Question 13: Following are some of the transactions of Zee Store for the month of March, 2005
Mar 1, Mr. Zeeshan invested Rs.550,000 in cash for his business.
Mar 1, Purchased shop building on cash worth Rs.320,000.
Mar 2, Purchased shop furniture on credit from Stylish Furniture Rs.80,000.
Mar 3, Purchased shop equipment on credit from I.B.M. Rs.90,000.
Mar 5, Purchased merchandise on cash worth Rs. 125,500.
Mar 7, Purchased merchandise on credit from Kashif & Sons on credit Rs.86,500.

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Mar 7, Paid transporting expenses Rs.580.
Mar 10, Sold merchandise on cash Rs.43,500.
Mar 15, Sold merchandise on credit to Baber & Company Rs.84,250.
Mar 17, Received commission revenue Rs. 16,600.
Mar 20, Purchased shop furniture on cash Rs.75,000.
Mar 21, Paid for merchandise purchased Rs.28,700.
Mar 22, Received on account of cash sales Rs.46,600.
Mar 26, Paid to Stylish Furniture, Rs.30,000.
Mar 27, Received cash from Baber & Company Rs.66,250.
Mar 28, Paid cash to Kashif & Sons Rs.36,500.
Mar 31, Paid salaries to employees for the month Rs.24,500.

Required:
1. Prepare the general journal entries.

Question 14: Following transaction relates to Mr. Hyder, a sole proprietor;

a) Mr. Hyder started business with cash investment Rs. 500,000
b) Borrowed loan form bank Rs. 50,000
c) Pays shop rent for the month Rs. 3,600
d) Purchased merchandise for cash Rs. 9,800.
e) Returned merchandise to supplier Rs. 800
f) Sold merchandise on account Rs. 14,500.
g) Made payment of a liability (bank loan).
h) Customer’s returned merchandise for Rs. 500.
i) Withdraw merchandise Rs. 2,700 for personal use.
j) Purchased furniture for Rs. 11,000, paying cash Rs. 5,600 and the balance after one month.
k) Earned sales commission and received cash Rs. 21,300.
l) Withdraw cash for personal use Rs. 2,900.
m) Paid advance for office rent Rs. 15,000
n) Received 6 month rent in advance in cash Rs. 6,000

Required:
1. Record these transitions in a two-Column general journal.

Question 15: The post-closing TB of Tayyab Sons showed the following balance on Dec 31, 2011
Cash 150,000 Tayyab capital 150,000

Their transactions for December 2011 were as follows:

1. Purchased merchandise on account from Sajid & Co. Rs. 40,000 & from Raja & Co. Rs. 30,000.
2. Returned merchandise on account to Sajid & Co. Rs. 10,000
3. Sold merchandise on accounting to Sami & Co. Rs. 11,700
4. Sold merchandise on accounting to Zakir & Co. Rs. 10,500.
5. Returned merchandise to Raja & Co. Rs. 12,000
6. Paid Rs. 29,000 to Mr. Sajid in the full settlement of account
7. Merchandise was returned by Sami & Co. 700 and by Zakir & Co. Rs. 500
8. Sold merchandise to Sami & Co. worth Rs. 2,000 for cash

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9. Received Rs. 9,500 from Zakir & Co. and allowed discount of Rs. 500
10. Received payment from Sami & Co for the settlement of account.

Required:
1. Record these transitions in a two-Column general journal.
2. T-account in the ledger, complete with all postings.