Question

(Closing Entries). Give the necessary entries in the Journal Proper of Ram on 31st March, 2018 to close their books:
Freehold Premises ₹30,000; Plant and Machinery ₹ 20,000; Sundry Debtors ₹25,000; Purchases ₹37,500; Sales ₹95,000; Discount (Dr.) ₹150; Discount (Cr.) ₹175; Sundry Creditors ₹12,500; Carriage Inwards ₹375; Carriage Outwards ₹600; Furniture and Fixtures ₹2,500; Wages ₹5,000; Bad debts ₹750; Salaries ₹3,600; Commission (Cr.) ₹2,125; Capital Account$-$​₹25,000; Bills Payable ₹7,500; Bills Receivable ₹9,000; Trade Expenses ₹2,550; Ram's Loan Account ₹20,000; Cash in Hand ₹75; Cash at Bank ₹3,125.

Answer 1

Journal
Date	Particulars		L.F.	Debit Amount (Rs)	Credit Amount (Rs)
	Trading A/c	Dr.		42,875
	To Purchases A/c				37,500
	To Carriage Inwards A/c				375
	To Wages A/c				5,000
	(Direct expenses debited to Trading A/c)
	Sales A/c	Dr.		95,000
	To Trading A/c				95,000
	(Sales credited to Trading A/c)
	Trading A/c	Dr.		52,125
	To Profit & Loss A/c				52,125
	(Transfer of gross profit to Profit &Loss A/c)
	Profit & Loss A/c	Dr.		7,650
	To Discount A/c				150
	To Carriage Outwards A/c				600
	To Bad Debts A/c				750
	To Salaries A/c				3,600
	To Trade Expenses A/c				2,550
	(Indirect expenses debited to P&L A/c)
	Discount A/c	Dr.		175
	Commission A/c	Dr.		2,125
	To Profit & Loss A/c				2,300
	(Indirect incomes credited to P&L A/c)
	Profit & Loss A/c	Dr.		46,775
	To Capital A/c				46,775
	(Transfer of net profit to Capital A/c)