JOURNAL : VASUNDHARA REPAIR COMPANY Date Particulars Dr Rs 180000 180000 Cr Rs

01.07.2012 Cash/Bank a/c To Capital a/c (Capital brought into business by Vashundhara) 02.07.2012 Hire Charges Expenses a/c To Cash/Bank a/c ( hire charges paid for derrick & pulley assmbly) 05.07.2012 Repair Materials (goods) a/c To Cash/Bank a/c To Construction Material Pvt. Ltd a/c (material obtained on credit from Cons.Co.) 06.07.2012 Cash/Bank a/c To Alacrity Consultants Co a/c ( adv. Reced. From M/s Alacrity Cons. Co.) 07.07.2012 M/s Adroit Engg. & Co a/c To Receivable a/c ( billed to Co. for completed work.) 11.07.2012 Misc. Expenses a/c To Cash/bank a/c ( Misc. expenses paid.) 12.07.2012 Fixed Asset equipment a/c To Cash/bank a/c To M/s Ready-mix Co. Ltd. a/c ( purchased concrete mixer partly cash and balance part on credit from M/s ready-mix.) 15.07.2012 Professional Service Expenses a/c To Cash/bank a/c ( paid prof. service charge to M/s Mehta Ass.) 16.07.2012 M/s Automatic Electric Ltd. a/c To Receivable a/c ( billed for repair work to M/s Auto Elec.Co.) 19.07.2012 Advertisement Expenses a/c To cash /bank a/c ( Adv. Expenses incurred ) 20.07.2012 M/s Construction Materials P.Ltd a/c

6800 6800

176000 50000 126000

29600 29600

15000 15000

2950 2950

85600 20800 64800

15000 15000

26800 26800

1900 1900

26000

To Cash/bank a/c ( paid to M/s Construction Mat. Co ) 23.07.2012 Rent Expenses a/c To Cash/bank a/c ( Rent paid for 3 months) 25.07.2012 Fixed Asset Typewriter a/c To Cash/bank a/c ( purchased typewriter for cash) 29.07.2012 Salary Expenses a/c To Cash/bank a/c ( paid Salaries & wages for July-12) 31.07.2012 Cash/bank a/c To M/s Automatic Electric Ltd. ( Reced. Payment from M/s Automatic Co.) 6900

26000

6900

5900 5900

26450 26450

26800 26800

NOTE : 1

1 2nd July entry of Hire Charges a/c paid for six months i.e. 5 months in advance. Hence entry may should be made as under : Debit Prepaid Exp. ( i.e advance hire charges) a/c Rs 5466 Hire Charges a/c Rs 1334 Credit Cash/bank a/c

Rs 6800

NOTE: 2 23rd July entry of rent for 3 months ( july to Sept) should be treated as under: Debit Rent expenses Prepaid Exp ( advance rent) Credit Cash/Bank

Rs 2300 Rs 4600

Rs 6900

Accordingly ledger accounts may be changed as under: New Ledger Head of " PREPAID EXPENSES" to be opened with DEBIT entry of Rs 4600 + Rs 5466 = Rs 10066

Hire Charges Expenses would be then debit fig of Rs 1334 instead of earlier Rs 6800 Similarly , Rent Expenses would be then debit fig of Rs 2300 instead of earlier Rs 6900

Accordingly Trial balance would be as under: S.No. 15 Rent would be Rs 2300 S.No.11 Hire charges would be Rs 1334 & New ledger head would be as under: S.No. 16 "Prepaid Expenses" debit fig Rs 10066

Hence total of Tria Balance remain same.

TIPS: Debit the Receiver Credit the Giver Debit what comes IN Credit what goes OUT Debit all Expenses ( losses) Credit all incomes ( Gains) For transactions with Persons, Company, entity etc. FOR PERSONAL ACCOUNTS Transactions for Goods, Cash, items,etc. FOR REAL ACCOUNTS For NOMINAL ACCOUNTS

tions with Persons, Company, entity etc.

ns for Goods, Cash, items,etc.