CA Foundation – Accounting Process II – Q1 Answers

No. Particulars Debit Credit

i. Cash A/c …Dr 3,00,000
To Capital A/c 3,00,000
(Being Cash introduced as Capital)
ii. Cash/Bank A/c …Dr 5,00,000
To Loan A/c 5,00,000
(Being Loan borrowed)
iii. Furniture A/c …Dr 2,00,000
To Cash A/c 2,00,000
(Being furniture purchased for cash)
iv. Plant & Machinery A/c …Dr 1,00,000
To Cash A/c 1,00,000
(Being Plant & Machinery purchased for cash)
v. Patents A/c …Dr 50,000
To Cash A/c 50,000
(Being Patent Rights purchased for cash)
vi. Purchases A/c …Dr 2,00,000
To Cash A/c 2,00,000
(Being cash purchases)
vii. Purchases A/c … Dr 10,00,000
To Creditors A/c 10,00,000
(Being credit purchases from suppliers)
viii. Cash A/c …Dr 3,00,000
To Sales A/c 3,00,000
(Being cash sales)
ix. Customer A/c …Dr 15,00,000
To Sales A/c 15,00,000
(Being credit sales to customers)
x. Creditors A/c …Dr 50,000
To Purchase Returns/ Return Outwards A/c 50,000
(Being credit purchases returned back to supplier)
xi. Sales Returns/ Return Inwards A/c …Dr 75,000
To Debtors A/c 75,000
(Being Sales returns from customers)
xii. Creditors A/c …Dr 3,00,000
To Cash A/c 3,00,000
(Being payment made to creditors)
xiii. Cash A/c …Dr 5,00,000
To Debtors A/c 5,00,000
(Being Cash received from debtors)
xiv. Bank A/c …Dr 6,00,000
To Debtors A/c 6,00,000
(Being cheque received from Debtors)
xv. Creditors A/c …Dr 4,00,000
To Bank A/c 4,00,000
(Being Cheque paid to Creditors)
xvi. Bills Receivable A/c …Dr 2,00,000
To Debtors A/c 2,00,000
(Being accepted Bills received from Debtors)
 a) Creditors A/c …Dr 1,00,000
To Bills Payable A/c 1,00,000
(Being bills accepted to creditors)
xvii. Discount Allowed A/c …Dr 30,000
To Debtors A/c 30,000
(Being cash discount allowed to debtors)
xviii. Creditors A/c …Dr 20,000
To Discount Received A/c 20,000
(Being cash discount received from creditors)
xix. Bad Debts A/c …Dr 40,000
To Debtors A/c 40,000
(Being bad debts written off)
xx. Salary A/c …Dr 60,000
To Cash A/c 60,000
(Being salary paid to employees)
xxi. Rent A/c …Dr 30,000
To Cash A/c 30,000
(Being rent paid to the landlord)
xxii. Insurance A/c …Dr 50,000
To Cash A/c 50,000
(Being Insurance premium paid)
xxiii. Telephone Charges A/c …Dr 5,000
To Cash A/c 5,000
(Being telephone charges paid)
xxiv. Stationery A/c …Dr 6,000
To Cash A/c 6,000
(Being Stationery Expenses paid)
xxv. Cash A/c …Dr 50,000
To Commission A/c 50,000
(Being commission income received)
xxvi. Cash A/c …Dr 80,000
To Royalty Inc A/c 80,000
(Being royalty income received)
xxvii. Drawing A/c …Dr 10,000
To Cash A/c 10,000
(Being cash withdrawn by proprietor for personal)
xxviii. Bank A/c …Dr 11,00,000
To Cash A/c 11,00,000
(Being cash deposited into bank)
xxix. Investments A/c …Dr 1,50,000
To Cash/ Bank A/c 1,50,000
(Being investments made)
xxx. Interest A/c …Dr 40,000
To Bank A/c 40,000
(Being interest on loan paid)
xxxi. Cash A/c …Dr 20,000
TO Interest on investments A/c 20,000
(Being interest received on investments)
 Year End Adjustment
a. Closing Stock A/c …Dr 1,00,000
To Trading A/c 1,00,000
(Being closing stock transferred to trading ac)
b. Salary A/c …Dr 20,000
To Outstanding Salary A/c 20,000
(Being outstanding salary transferred to salary a/c)
c. Prepaid Rent A/c …Dr 3,000
To Rent A/c 3,000
(Being prepaid rent deducted from rent a/c)
d. Accrued Commission A/c …Dr 10,000
To Commission A/c 10,000
(Being accrued commission charged to Commission a/c)
e. Royalty A/c …Dr 6,000
To Royalty in Advance A/c 6,000
(Being royalty rcvd in advance transferred to advance a/c)
f. Interest on capital A/c …Dr 10,000
To Capital A/c 10,000
(Being interest on capital provided)
g. Capital/Drawings A/c …Dr 1,000
To Interest on drawing A/c 1,000
(Being interest on drawings charged)
h. Depreciation A/c …Dr
To Plant & Machinery A/c 10,000 10,000
(Being depreciation on P&M charged)
i. Bad Debts A/c …Dr 10,000
To Debtors A/c 10,000
(Being Bad debts charged to debtors a/c)
j. Interest on Loan A/c …Dr 5,000
To Outstanding loan A/c 5,000
(Being outstanding loan charged)
k. Accrued Interest A/c …Dr 3,000
To Interest A/c 3,000
(Being accrued interest on investments charged)
l. Bad Debts A/c …Dr 6,000
To Provision for Bad Debts A/c 6,000
(Being provision created for doubtful debts)
m. Provision for discount on debtors A/c …Dr 3,000
To Debtors A/c 3,000
(Being provision for discount ton debtors created)
n. Creditors A/c …Dr 1,000
To Provision for discount on creditors A/c 1,000
(Being Provision for discount ton creditors created)
2.Journalise the Following special Transaction
i) Bad Debts Recovered Rs.6,000

Cash a/c dr. 6,000

To bad debts recovered a/c 6,000

ii) Abnormal loss of goods rs.60,000

Abnormal loss a/c dr. 60,000
To purchases a/c 60,000

iii) Insurance claim received Rs.20,000 in respect of abnormal loss

Cash a/c dr. 20,000
To insurance claim a/c 20,000

iv) Insurance claim receivable in respect of abnormal loss Rs.10,000

Insurance claim receivable a/c dr. 10,000
To insurance claim a/c 10,000

v) Scarp value realized in respect of abnormal loss Rs.5,000

Cash a/c dr. 5,000
To scrap value of abnormal loss a/c 5,000

vi) Normal loss of goods costing Rs.6,000

No entry
vii) Scarp value of normal loss realizing Rs.1,000
Cash a/c dr. 1,000
To scrap value of normal loss 1,000

viii) Proprietor withdrew goods for personal use cost price Rs.6,000 Selling price 8,000
Drawings a/c dr. 6,000
To purchases a/c 6,000

ix) Goods Given as charity Rs.3,000

 Charity a/c dr. 3,000
To purchases/trading a/c 3,000

x) Goods given as free Samples Rs.10,000

Free samples a/c dr. 10,000
To purchases a/c 10,000

xi) Goods used for construction purpose Rs.15,000

Building under construction a/c dr. 15,000
To purchases a/c 15,000

xii) Goods given as gift to employees Rs.7,000

Gift to employees a/c dr. 7,000
To purchases a/c 7,000

xiii) Goods destroyed by Fire Rs.6,000

Abnormal loss a/c dr. 6,000
To purchases/trading a/c 6,000

xiv) Elephant purchased Rs.60,000

elephant a/c dr. 60,000
To cash a/c 60,000

xv) Goodwill Purchased Rs.1 lac

Goodwill a/c dr. 1L
To cash a/c 1L

xvi) Cash embezzled by the cashier Rs.30,000

Abnormal loss a/c dr. 30,000
To cash a/c 30,000

xvii) Till Taking Rs.20,000

Cash a/c dr. 20,000
 To sales a/c 20,000

xviii) Propertor withdraw Cheque for personal use RS.5000

Drawings a/c dr. 5,000
To bank a/c 5,000

xix) Life insurance premium paid for the proprietor Rs.20,000

Drawings a/c dr. 20,000
To cash a/c 20,000

xx) Personal income taxes paid Rs.10,000

Drawings a/c dr. 10,000
To cash a/c 10,000

xxi) Opening provision for doubtful depts. Rs.3000

PDD a/c dr. 3,000
To bad debts a/c 3,000

xxii) Opening provision for discount on debtors Rs.2000

Provisions for discount on debtor a/c 2,000
dr.
To discount allowed a/c 2,000

xxiii) Opening provision for discount on creditors Rs.1000

Discount received a/c dr. 1,000
To prov. For discount on creditor a/c 1,000

xxiv) Trade discount allowed to customer Rs.5,000

No entry
xxv) Trade discount received from supplier Rs.4,000
No entry
xxvi) Cash discount allowed to customer Rs.7,000
Discount allowed a/c dr. 7,000
 To debtor a/c 7,000

xxvii) Cash discount received from suppliers Rs.5,000

creditor a/c dr. 5,000
To discount received a/c 5,000

xxviii) Banks charges charged by the bank Rs.500

Bank charges a/c 500
To bank a/c 500

xxix) Interest credit in our pass book Rs. 1000

Bank a/c dr. 1,000
To interest received a/c 1,000

xxx) Interest on overdraft Rs.3000

Interest on od a/c 3,000
To bank a/c 3,000

xxxi) A customer owes Rs.1 lac has became insoluant out of the private assets ,we could
recover only 60 paisa in Rs .1
Cah a/c dr. 60,000
Bad debts a/c dr. 40,000
To debtor a/c 1,00,000

xxxii) A customer who owes Rs.3000 directly paid the money to our supplies
Creditor a/c dr. 3,000
To debtor a/c 3,000

xxxiii) Totaling error committed in pass by our banker due to which our pass book balance
decrease by By Rs.3000
No entry
3. ANSWER

CASE A CASE B
i. Anand a/c dr. 50,000 Anand a/c dr. 50,000
Balu a/c dr. 40,000 Balu a/c dr. 40,000
Chandru a/c 30,000 Chandru a/c 30,000
dr. dr.
Deepa a/c dr. 20,000 Deepa a/c dr. 20,000
Elizabeth a/c 10,000 Elizabeth a/c 10,000
dr. dr.
To sales a/c 1,50,000 To sales a/c 1,50,000
ii. Sales return a/c 15,000 Sales return a/c 15,000
dr. dr.
To anand a/c 5,000 To anand a/c 5,000
To balu a/c 4,000 To balu a/c 4,000
To chandru 3,000 To chandru 3,000
a/c a/c
To deepa a/c 2,000 To deepa a/c 2,000
To Elizabeth 1,000 To Elizabeth 1,000
a/c a/c
iii. Bank a/c dr. 42,000 cash a/c dr. 42,000
Discount 3,000 Discount 3,000
allowed a/c dr. allowed a/c dr.
To anand a/c 45,000 To anand a/c 45,000
iv. Bank a/c dr. 25,000 cash a/c dr. 25,000
To balu a/c 25,000 To balu a/c 25,000
v. Bank a/c dr. 67,000
NO ENTRY
To cash a/c 67,000
vi. NO ENTRY NO ENTRY
vii. Bank a/c dr. 10,000 cash a/c dr. 10,000
To chandru 10,000 To chandru 10,000
a/c a/c
viii. Creditor a/c dr. 10,000 Creditor a/c dr. 10,000
To bank a/c 10,000 To cash a/c 10,000
vix. NO ENTRY NO ENTRY
x. Bank a/c dr. 6,000 cash a/c dr. 6,000
To deepa a/c 6,000 To deepa a/c 6,000
xi. Creditor a/c 6,000 Creditor a/c dr. 6,000
dr.
To bank a/c 6,000 To cash a/c 6,000
xii. Deepa a/c dr. 6,000 Deepa a/c dr. 6,000
To creditor a/c 6,000 To creditor a/c 6,000
xiii. Bank a/c dr. 5,000 Cash a/c dr. 5,000
To Elizabeth 5,000 To Elizabeth 5,000
a/c a/c
xiv. Bank a/c dr. 5,000
NO ENTRY
To cash a/c 5,000
xv. Elizabeth a/c 5,000 Elizabeth a/c 5,000
dr. dr.
To bank a/c 5,000 To cash a/c 5,000
 CA Foundation – Accounting Process II Q4 Answers

No. Particulars Debit Credit

i. Cash A/c …Dr 3,00,000
To Sales A/c 3,00,000
(Being Cash sales)
ii. Debtors A/c …Dr 20,00,000
To Sales A/c 20,00,000
(Being credit sales)
iii. Purchases A/c …Dr 2,00,000
To Cash A/c 2,00,000
(Being cash purchases)
iv. Purchases A/c …Dr 10,00,000
To Creditors A/c 10,00,000
(Being credit purchases)
v. Cash A/c …Dr 5,00,000
To Debtors A/c 5,00,000
(Being Cash received from debtors)
vi. Bank A/c …Dr 5,00,000
To Debtors A/c 5,00,000
(Being cheque received from debtors)
vii. Bills Receivable A/c …Dr 5,00,000
To Debtors A/c 5,00,000
(Being acceptance received from debtors)
viii. Creditors A/c …Dr 2,00,000
To Cash A/c 2,00,000
(Being cash paid to creditors)
ix. Creditors A/c …Dr 3,00,000
To Bank A/c 3,00,000
(Being cheque paid to creditors)
x. Creditors A/c …Dr 3,00,000
To Bills Payable A/c 3,00,000
(Being acceptance given to creditors)
xi. Cash A/c …Dr 1,00,000
To Bills Receivable A/c 1,00,000
(Being B/R honoured)
xii. Bank A/c …Dr 95,000
Discounting charges …Dr 5,000
To Bills Receivable A/c 1,00,000
(Being bills discounted at the bank)
xiii. Creditors A/c …Dr 4,00,000
To Bills Receivable A/c 4,00,000
(Being Bills endorsed to creditors)
xiv. Debtors A/c …Dr 80,000
To Bills Rrceibale A/c 80,000
(Being bills held till maturity, dishonoured)
xv. No entry … …
 xvi. Debtors A/c …Dr 40,000
To Bank A/c 40,000
(Being bill discounted with the bank dishonoured)
xvii. No entry
xviii. Debtors A/c …Dr 20,000
To Creditors A/c 20,000
(Being bills endorsed to creditor dishonoured)
xix. Bills Payable A/c …Dr 2,00,000
To Cash A/c 2,00,000
(Being bill payable honoured)
xx. Bills Payable A/c …Dr 1,00,000
To Creditors A/c 1,00,000
(Being bills payable dishonoured)