Question

Journalise the following transactions:
(i) Bought goods from Arun for ₹ 2,00,000 at a trade discount of 15% and cash discount of 2%. Paid 80% amount immediately.
(ii) Purchased foods for ₹ 20,000 from X and supplied it to Y for ₹ 26,000.
(iii) Cash withdrawn from bank ₹ 5,000 for personal use and ₹ 25,000 for office use.
(iv) Goods destroyed by fire : Cost Price ₹ 40,000.
(v) Provide 20% depreciation on machinery costing ₹ 50,000.
(vi) Out of insurance paid this year, ₹ 3,000 is related to next year.
(vii) Allow ₹ 5,000 as interest on capital and charge ₹ 1,000 as interest on drawings.
(viii) Sohan who owed us ₹ 25,000 was declared insolvent and a cheque of 40 paise in a ₹ is received from him in full settlement.
(ix) Paid Income Tax ₹ 10,000 by cheque.
(x) Salary paid ₹ 80,000 and Salary Outstanding ₹ 20,000.

Answer 1

Journal In the Books of …
Date	Particulars		L.F.	Debit Amount (₹)	Credit Amount (₹)
(i)	Purchases A/c (WN)	Dr.		1,70,000
	To Arun’s A/c				34,000
	To Cash A/c				1,33,280
	To Discount Received A/c				2,720
	(Goods purchased and 80% payment made in cash)
(ii)	Purchases A/c	Dr.		20,000
	To X’s A/c				20,000
	(Goods purchased on credit from X)
	Y’s A/c	Dr.		26,000
	To Sales A/c				26,000
	(Goods sold on credit to Y)
(iii)	Cash A/c	Dr.		25,000
	Drawings A/c	Dr.		5,000
	To Bank A/c				30,000
	(Cash withdrawn from bank for personal and office use)
(iv)	Loss by Fire A/c	Dr.		40,000
	To Purchases A/c				40,000
	(Goods destroyed by fire)
(v)	Depreciation A/c	Dr.		10,000
	To Machinery A/c				10,000
	(Depreciation charged on machinery)
(vi)	Prepaid Insurance A/c	Dr.		3,000
	To Insurance A/c				3,000
	(Insurance paid in advance)
(vii)	Interest on Capital A/c	Dr.		5,000
	To Capital A/c				5,000
	(Allowed interest on capital)
	Drawings A/c	Dr.		1,000
	To Interest on Drawings A/c				1,000
	(Charged interest on drawings)
(viii)	Cash A/c	Dr.		10,000
	Bad Debts A/c	Dr.		15,000
	To Sohan’s A/c				25,000
	(Cash received from Sohan and bad debts written-off)
(ix)	Drawings A/c	Dr.		10,000
	To Bank A/c				10,000
	(Income tax paid)
(x)	Salaries A/c	Dr.		1,00,000
	To Cash A/c				80,000
	To Outstanding Salaries A/c				20,000
	(Salary paid and outstanding)
	TOTAL			4,40,000	4,40,000

Working Notes: Calculation of payment made and outstanding amount to Arun