Question

Journalise the following transactions in the Journal of Navin Gupta & Sons.:-
1. Out of Insurance premium paid this year, ₹ 15,000 is related to next year.
2. Credit purchases from Ram & Co. for ₹ 50,000. Cash discount will be received at 5% on payment of bill within 10 days.
3. Cash paid to Ram & Co. and discount availed of.
4. Paid Income Tax ₹ 20,000 by cheque.
5. Goods costing ₹ 2,00,000 sold for cash at a profit of 10%.
6. Purchased iron safe for ₹ 2,00,000 filing cabinet for ₹ 50,000 and Computer for ₹ 1,00,000.

Answer 1

Journal In the Books of Sh. Navin Gupta
Date	Particulars		L.F.	Debit Amount (₹)	Credit Amount (₹)
1)	Prepaid Insurance A/c	Dr.		15,000
	To Insurance A/c				15,000
	(Prepaid insurance recorded)
2)	Purchases A/c	Dr.		50,000
	To Ram & Co.				50,000
	(Goods purchased on credit from Ram & Co.)
3)	Ram & Co.	Dr.		50,000
	To Cash A/c				47,500
	To Discount Received A/c				2,500
	(Cash paid to Ram & Co. in full settlement)
4)	Drawings A/c	Dr.		20,000
	To Cash A/c				20,000
	(Paid income tax)
5)	Cash A/c	Dr.		2,20,000
	To Sales A/c				2,20,000
	(Goods sold for cash including profit of 10%)
6)	Office Equipment A/c	Dr.		3,50,000
	To Cash A/c				3,50,000
	(Office equipment purchased)
	TOTAL			7,05,000	7,05,000